Translation
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any
discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results
for the Year Ended March 31, 2018
(Based on Japanese GAAP)May 9, 2018
Company name:

KYOWA EXEO CORPORATION

Stock exchange listing: Tokyo
Stock code:
1951
Representative:
Inquiries:

URL

http://www.exeo.co.jp/President
Operating Officer, General Manager,

Accounts & Finance Division
Scheduled date of ordinary general meeting of shareholders:Fuminori Kozono
Hideo Higuchi

TEL03-5778-1105

June 22, 2018

Scheduled date to file Securities Report:
Scheduled date to commence dividend payments:

June 22, 2018
June 25, 2018

Preparation of supplementary material on financial results:
Holding of financial results meeting:

YesYes(Amounts less than one million yen are rounded down)
1. Consolidated financial results for the year ended March 31, 2018 (from April 1, 2017 to March 31, 2018)(1) Consolidated operating results
Net salesYear ended March 31, 2018Year ended March 31, 2017

Operating profit

Millions of yen
312,669
298,825%
4.6
4.0

Earnings per share

Diluted earnings pershare%
22.7
13.4

Profit attributable toOrdinary profit/total Operating profit/net
owners ofassets
sales
parent/equity
Yen%%%
188.72
10.8
10.4
8.2
144.87
8.9
8.9
7.0

Yen
189.42145.24

Year ended March 31, 2018Year ended March 31, 2017

Millions of yen
25,621
20,873

Percentages indicate year-on-year changes
Profit attributable toOrdinary profit
owners of parent
Millions of yen% Millions of yen%
26,44823.5
17,99330.521,409
15.7
13,78913.2(2) Consolidated financial position
Total assets
As of March 31, 2018
As of March 31, 2017

Net assets

Equity ratio

Millions of yen
263,632
243,438

Millions of yen
176,101
158,280

Cash flows fromoperating activities
Millions of yen
24,80015,504

Cash flows frominvesting activities
Millions of yen(4,538)(6,027)

Net assets per share%
66.6
64.8

Yen
1,842.97
1,668.29(3) Consolidated cash flows

Year ended March 31, 2018Year ended March 31, 2017

Cash flows from
Cash and cash equivalents
at end of period
financing activities
Millions of yen
Millions of yen(5,137)30,343(10,230)
15,241

2. Cash dividends
Annual dividends per share
1st quarter-end 2nd quarter-end 3rd quarter-end Fiscal year-end

Year ended March 31, 2017
Year ended March 31, 2018Year ending March 31, 2019
(Forecast)of dividends
Total cash
Dividend payout Ratio
to net assets
dividends (Total) ratio (Consolidated) (Consolidated)

Total

Yen

Yen

Yen

Yen

Yen

Millions of yen

%%

––

23.00
25.00

–
–

23.00
25.00

46.00
50.00

4,389
4,786

31.7
26.4

2.8
2.8–32.00–32.00

64.00

132.3

3. Forecast of consolidated financial results for the year ending March 31, 2019 (from April 1, 2018 to March 31, 2019)
Net sales
Millions of yen
Six months ending
September 30, 2018
Full year

Percentages indicate year-on-year changes
Profit attributable toOperating profit
Ordinary profit
Earnings per shareowners of parent% Millions of yen% Millions of yen% Millions of yen%Yen

128,000

2.4

8,200(7.9)

8,500(12.4)

5,700(10.4)

60.05

335,000

7.1

27,5007.3

28,1006.2

18,8004.5

198.33

4. Notes(1) Changes in significant subsidiaries during the year ended March 31, 2018(changes in specified subsidiaries resulting in the change in scope of consolidation):No(2) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
Changes in accounting policies due to revisions to accounting standards and other regulations:
NoChanges in accounting policies due to other reasons:
Changes in accounting estimates:

NoNo

Restatement of prior period financial statements:

No(3) Number of issued shares (common shares)
Total number of issued shares at the end of the period (including treasury shares)
As of March 31, 2018

117,812,419 shares As of March 31, 2017

117,812,419 shares

Number of treasury shares at the end of the period
As of March 31, 2018

22,545,402 shares As of March 31, 201723,221,906 shares

94,991,522 shares Year ended March 31, 2017

94,938,161 shares

Average number of shares during the period
Year ended March 31, 20182

Consolidated financial statements
Consolidated balance sheets(Millions of yen)
As of March 31, 2017

As of March 31, 2018

AssetsCurrent assetsCash and deposits
Notes receivable, accounts receivable from completed
construction contracts
Securities

15,431

26,09596,08092,18563

4,499

Costs on uncompleted construction contracts and other
Deferred tax assets

24,1593,733

27,617
3,914

Other
Allowance for doubtful accounts

2,927
(0)

1,967
(1)

142,395

156,280

Buildings and structures, net
Machinery, vehicles, tools, furniture and fixtures, net

20,0744,710

21,003
4,542

Land
Other, net

36,1971,021

36,602516

Total property, plant and equipment

62,002

62,664

Total current assets
Non-current assets
Property, plant and equipment

Intangible assets
Goodwill

1,053

658

Other

3,360

3,251

Total intangible assets

4,414

3,909

Investment securities
Net defined benefit asset

17,093
14,52019,833
17,947

Other
Allowance for doubtful accounts

4,228(1,216)

3,231
(235)

Total investments and other assets

34,626

40,777101,042

107,351

243,438

263,632

Investments and other assets

Total non-current assets
Total assets

3(Millions of yen)
As of March 31, 2017

As of March 31, 2018

Liabilities
Current liabilities
Notes payable, accounts payable for construction contracts

36,60634,802

Short-term loans payable
Income taxes payable

826
4,142

1,012
5,004

Advances received on uncompleted construction contracts
Provision for bonuses

3,457
1,242

3,574
1,421

129
57

126
58

Provision for loss on construction contracts
Other

507
14,314290
16,870Total current liabilities

61,28363,161

10,00010,000

1,390
5,244

10
7,293

257
206

272
42

Net defined benefit liability
Other

4,925
1,851

5,070
1,680

Total non-current liabilities

23,87424,36985,15887,531

Shareholders' equityCapital stock

6,888

6,888

Capital surplus
Retained earnings

7,978
156,477

8,098
169,883

Provision for directors' bonuses
Provision for warranties for completed construction

Non-current liabilities
Bonds payable
Long-term loans payable
Deferred tax liabilities
Provision for directors' retirement benefits
Allowance for investment loss

Total liabilities
Net assets

Treasury shares(24,011)(23,187)

Total shareholders' equity

147,333

161,682

3,566
15

5,198
11

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans

6,888

8,681

Total accumulated other comprehensive income

10,47013,891

Share acquisition rights

288

285

Non-controlling interests

187

242

158,280

176,101

243,438

263,632

Total net assets
Total liabilities and net assets

4Consolidated statements of income and consolidated statements of comprehensive income
Consolidated statements of income(Millions of yen)
Fiscal year ended
March 31, 2017

Fiscal year ended
March 31, 2018

Net sales of completed construction contracts

298,825

312,669

Cost of sales of completed construction contracts

260,344

269,315Gross profit on completed construction contracts

38,48043,354

Selling, general and administrative expenses

17,607

17,732

Operating profit

20,87325,621

44

Dividend income
Land and house rent received

315
572

403
401

Gain on sales of non-current assets
Reversal of allowance for investment loss

437
–

114
170

Reversal of allowance for doubtful accounts
Gain on exchange of investment securities

111
203

34–

Non-operating income
Interest income

Other290

269

1,936

1,398

Interest expenses
Rent expenses

49
185

33
105

Loss on sales of non-current assets
Loss on retirement of non-current assets

516
4557
68

Foreign exchange losses
Other143
458

169
137

Total non-operating income
Non-operating expenses

Total non-operating expenses

1,400

571

21,40926,448Gain on sales of investment securities
Gain on abolishment of retirement benefit plan

1,262
209

–
–

Total extraordinary income

1,471

–

2,159

–

Ordinary profit
Extraordinary income

Extraordinary losses
Impairment loss

2,159

–

Profit before income taxes

Total extraordinary losses

20,721

26,448

Income taxes - current
Income taxes - deferred7,719
(737)

8,018
375

Total income taxes

6,982

8,393

Profit13,73918,054

Profit (loss) attributable to non-controlling interests
Profit attributable to owners of parent

5(50)

61

13,78917,993

Consolidated statements of comprehensive income(Millions of yen)

ProfitOther comprehensive income

Fiscal year ended

Fiscal year ended

March 31, 2017

March 31, 2018
13,73918,054

Valuation difference on available-for-sale securities
Foreign currency translation adjustment

(554)
(30)

1,631
(10)

Remeasurements of defined benefit plans, net of tax

216

1,793

(368)

3,414

Comprehensive income

Total other comprehensive income

13,37021,469Comprehensive income attributable toComprehensive income attributable to owners of parent

13,43821,413(68)

55

Comprehensive income attributable to non-controllinginterests

6

Consolidated statements of changes in equity
Fiscal year ended March 31, 2017
(Millions of yen)
Shareholders' equity
Capital stock
Balance at beginning of current
periodCapital surplus

6,888

Retained earnings

7,939

Treasury shares

147,004

Cumulative effects of changes
in accounting policies

Total shareholders'equity(21,910)

139,922

22

Restated balance

6,888

7,939

22

147,027(21,910)

139,945

Changes of items during period
Dividends of surplus(4,338)(4,338)

Profit attributable to ownersof parent

13,78913,789Purchase of treasury shares
Disposal of treasury shares

38

Transfer of treasury shares via
trust(3,002)(3,002)

167

206

733

733

Net changes of items otherthan shareholders' equity
Total changes of items during
periodBalance at end of current period

–38

9,450

(2,101)

7,388

6,888

7,978

156,477(24,011)

147,333

Accumulated other comprehensive income
Valuationdifference on
available-forsale securities
Balance at beginning of current
period4,121Foreigncurrencytranslation
adjustment

Total
accumulated
otherof defined benefit
comprehensiveplansincomeRemeasurements

28

6,671

10,821

Share
acquisitionrights241

Non-controlling
Total net assetsinterests

255

Cumulative effects of changes
in accounting policies
Restated balance

151,241
22

4,121

28

6,671

10,821

241

255

151,263

Changes of items during period
Dividends of surplus(4,338)

Profit attributable to ownersof parent

13,789Purchase of treasury shares(3,002)

Disposal of treasury shares

206

Transfer of treasury shares via
trust

733

Net changes of items otherthan shareholders' equity

(554)

(12)

216(350)

47(68)(371)

Total changes of items during
period

(554)

(12)

216

(350)

47(68)

7,016

Balance at end of current period

3,566

15

6,888

10,470288

187

158,280

7

Fiscal year ended March 31, 2018
(Millions of yen)
Shareholders' equity
Capital stock
Balance at beginning of current
periodCapital surplus

6,888

Retained earnings

7,978

Total shareholders'equity

Treasury shares

156,477(24,011)

147,333

Cumulative effects of changes
in accounting policies–

Restated balance

6,888

7,978

156,477(24,011)

147,333

Changes of items during period
Dividends of surplus(4,588)(4,588)

Profit attributable to ownersof parent

17,993

17,993Purchase of treasury shares
Disposal of treasury shares

120

Transfer of treasury shares viatrust

(3)

(3)

311

431

515

515

Net changes of items otherthan shareholders' equity
Total changes of items during
periodBalance at end of current period–

120

13,405823

14,3496,888

8,098

169,883(23,187)

161,682

Accumulated other comprehensive income
Valuationdifference on
available-forsale securities
Balance at beginning of current
period3,566

Foreigncurrencytranslation
adjustment

Total
accumulated
otherof defined benefit
comprehensive
plansincomeRemeasurements

15

6,888

10,470Share
acquisitionrights288

Non-controlling
Total net assetsinterests

187

Cumulative effects of changes
in accounting policies
Restated balance

158,280
–

3,566

15

6,888

10,470288

187

158,280

Changes of items during period
Dividends of surplus(4,588)

Profit attributable to ownersof parent

17,993Purchase of treasury shares(3)

Disposal of treasury shares

431

Transfer of treasury shares via
trust

515

Net changes of items otherthan shareholders' equity

1,631

(4)

1,793

3,420

(3)

55

3,471

Total changes of items during
period

1,631

(4)

1,793

3,420

(3)

55

17,820

Balance at end of current period

5,198

11

8,681

13,891

285

242

176,101

8Consolidated statements of cash flows(Millions of yen)

Cash flows from operating activities
Profit before income taxes

Fiscal year endedFiscal year ended

March 31, 2017

March 31, 2018
20,721

26,448Depreciation
Impairment loss

3,251
2,159

3,272
0

Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts

929
(148)

395(980)

Increase (decrease) in provision for bonuses
Increase (decrease) in provision for warranties for completed

117

179

(850)

0construction
Increase (decrease) in provision for loss on construction
contracts
Increase in Defined Benefit Asset or Liability

248

(216)

(399)

(694)

Interest and dividend income
Interest expenses(319)
49(407)(33)

Loss (gain) on sales of non-current assets
Loss (gain) on sales of investment securities

79(1,262)(56)
0Gain on exchange of investment securities
Gain on abolishment of retirement benefit plan

(203)
(209)

––

(3,127)

3,892(2,659)(3,447)

Decrease (increase) in notes and accounts receivable - trade
Decrease (increase) in costs on uncompleted construction
contracts and other
Decrease (increase) in other assets
Increase (decrease) in notes and accounts payable - trade
Increase (decrease) in advances received on uncompleted
construction contracts
Increase (decrease) in other liabilities

965

2,175(1,014)(1,802)

204

118

2,671

2,327

Other, net

390

285

Subtotal

21,59531,456

Interest and dividend income received

318

408

Interest expenses paid
Income taxes paid

(66)
(6,343)33(7,098)Net cash provided by (used in) operating activities

15,50424,800Cash flows from investing activities
Purchase of property, plant and equipment(5,761)(3,214)

Proceeds from sales of property, plant and equipment
Purchase of intangible assets

901(2,416)352(1,010)Purchase of investment securities
Proceeds from sales of investment securities

(443)
1,686

(429)
0

Payments of loans receivableCollection of loans receivable(111)
1(204)
14472

1(35)

(6,027)(4,538)Decrease (increase) in time deposits and other
Other, net
Net cash provided by (used in) investing activities

9

(Millions of yen)

Cash flows from financing activities
Net increase (decrease) in short-term loans payable

Fiscal year ended

Fiscal year ended

March 31, 2017

March 31, 2018(12,306)(100)

Proceeds from issuance of bonds
Repayments of long-term loans payable

9,991(1,227)–(1,093)

Purchase of treasury shares
Proceeds from sales of treasury shares(3,002)
153

(3)
308

Transfer of treasury shares via trust
Cash dividends paid

733
(4,329)515(4,581)Other, net

(244)

(182)

(10,230)(5,137)

(42)

(23)

Net increase (decrease) in cash and cash equivalents(796)

15,101

Cash and cash equivalents at beginning of period

16,037

15,241

Cash and cash equivalents at end of period

15,241

30,343

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash equivalents

10