Notice: This document has been translated from Japanese original for reference purpose only, without any warranty as to its
accuracy or as to the completeness of the information. The Japanese original version is the sole official version.

Summary of Consolidated Financial Results for the Fiscal Year Ended March 31, 2020
[Japanese GAAP]
April 28, 2020
EM SYSTEMS CO., LTD.
Listed on:Tokyo Stock Exchange, First Section
ＵＲＬ http://www.emsystems.co.jp
4820
Securities Code
Representative
Kozo Kunimitsu, Chairman and CEO
Representative
Gen Aota, Managing director in the company, executive officer
Tel: +81-6-6397-1888
for inquiries
and chief of the Administrative Planning HQScheduled date of Annual General Meeting of Shareholders:June 16,2020
Scheduled date of payment of dividend:
June 17,2020
Scheduled date of filing of Annual Securities Report:
June 17,2020
Preparation of supplementary materials for financial results:
Yes
Holding of financial results meeting:Yes (for securities analysts)
Company name（All amounts are rounded down to the nearest million yen）
1. Consolidated Financial Results for the Fiscal Year Ended March 31, 2020 (April 1, 2019 – March 31, 2020)（Percentages represent year-on-year changes）(1) Consolidated management performance (total)
Net sales

Fiscal year ended
Mar. 31, 2020
Fiscal year ended
Mar. 31, 2019

Profit attributable toowners of parent

Ordinary profit

Millions ofyen％Millionsof yen％Millions ofyen％Millions ofyen％

14,0236.8

1,583(39.6)

2,179(32.9)

1,393(29.3)

13,133

(5.9)

2,622

(14.4)

3,248(10.2)

1,971(16.8)（refer to）Equity in

Fiscal year ended

earnings of affiliates

Mar. 31, 2020

Fiscal year ended
Mar. 31, 2020
Fiscal year ended
Mar. 31, 2019

Operating profit

1,399

Millions of yen(28.0％）

Fiscal year ended
Mar. 31, 2019

1,942

Millions ofyen（19.1％）Net income per share

Diluted net income pershare

Yen 100ths of a yen

Yen 100ths of a yen

％

％

％

19.74

19.47

8.2

9.5

11.3

27.87

27.46

12.2

14.7

20.0

Return on equity

Ordinary profit on Operating profit
total assets
to net sales(Refer to) Equity in
Fiscal year ended
Fiscal year ended－ Millions of yen－ Millions of yen
earnings of affiliates
Mar. 31, 2020
Mar. 31, 2019（(Note)1. This company implemented a stock split at a rate of 2 shares per 1 share of ordinary stock with an effective date of January 1st,
2020. We have calculated "quarterly net income per share" and "net income after potential stock adjustment "assuming that said
stock split was conducted at the beginning of previous fiscal year.
2. During the 4th quarter consolidated accounting period for the fiscal year ending in March 2020, the Company finalized
provisional accounting processes relating to corporate combination and reflected the results of these in the various values
relating to the fiscal year ending in March 2019.
(2) Consolidated financial position
Total assets
As of Mar. 31, 2020
As of Mar. 31, 2019

Millions of yen
23,451
22,396

Net assets

Millions of yen
17,676
16,618

Capital adequacy ratio

％
75.0
73.6

Net assets per share
Yen 100ths of a yen

247.30234.53

17,584 Millions of yen
16,489 Millions of yen
As of Mar. 31, 2019
As of Mar. 31, 2020（(Note)1. This company implemented a stock split at a rate of 2 shares per 1 share of ordinary stock with an effective dateof January 1st, 2020. We have calculated "quarterly net income per share" and "net income after potential stock
adjustment "assuming that said stock split was conducted at the beginning of previous fiscal year.
2. During the 4th quarter consolidated accounting period for the fiscal year ending in March 2020, the Company
finalized provisional accounting processes relating to corporate combination and reflected the results of these in
the various values relating to the fiscal year ending in March 2019.

(Refer to) Net capital－

1 －(3) Consolidated cash flows
Cash flows from operating Cash flows from investing Cash flows from financing Cash and cash equivalents
activities
activities
activities
at end of period
Yen 100ths of a yen

Yen 100ths of a yen

Yen 100ths of a yen

Yen 100ths of a yen

2,300

(343)

(668)

8,770

1,846

(894)

(1,982)

7,486

Total dividends

Fiscal year ended
Mar. 31, 2020
Fiscal year ended
Mar. 31, 2019

2. State of dividends
Annual dividends
End of 1stquarter

End of 2ndquarter

End of 3rdquarter

End of
term

Total

Yen
100ths of
a yen

Yen
100ths of
a yen

Yen
100ths of
a yen

Yen
100ths of
a yen

Yen
100ths ofa yen

PayoutDividendratio
on equity(consolidate (consolidatd)ed)Millions of
yen

％

％

Fiscal year ended
8.00
11.00
19.00
669
34.1
4.1
－
－
Mar. 31, 2019
Fiscal year ended
8.00
6.00
708
50.7
4.2
－
－
－
Mar. 31, 2020
Fiscal year ended
4.00
6.00
10.00
66.0
Dec. 31, 2020－－
(estimate)(Note) This company implemented a stock split at a rate of 2 shares per 1 share of ordinary stock with an effective date of January
1st, 2020. Regarding the dividends of the 2nd quarter, end of term of the March 2019 period, the 2nd quarter of the March 2020
period, we have included the amounts of actual dividends before said stock split. The annual dividend amount per sharecalculated under the post-stock split standard is 9.5 yen for the March 2019 period, 10 yen for the March 2020 period.
3. Estimated consolidated results of the Fiscal Year Ending December 31, 2020 (April 1, 2020 – December 31, 2020)

Net salesFirst half
Full year（Percentages represent year-on-year changes）
Net
Profit attributable toOrdinary profit
incomeowners of parent
per share

Operating profit

Millionsof yen％

6,728
10,092Millions of
yen

％

Yen
100ths ofa yen(19.1)

721(16.3)

10.15

－

1,082

－

15.22

Millionsof yen％Millionsof yen

％

(5.1)

751

(22.0)

1,037

－

1,127

－

1,556

(Note) On the condition that the Matter of Partial Revision to the Articles of Incorporation is approved at the regular meeting ofshareholders for the 37th fiscal year, scheduled for June 16, 2020, the Company plans to change the fiscal year end fromMarch 31 to December 31 starting from 2020. The Company also plans to make the same change within domestic
subsidiaries for which the fiscal year end is a date other than December 31. Accordingly, in regard to consolidated
performance forecasts for the fiscal year ending in December 2020, which encompasses the duration of the fiscal year after
the aforementioned changes, the period subject to consolidation for both the Company and all domestic subsidiaries forwhich the fiscal year end had been in March shall be the 9-month period from April to December, and for overseas
subsidiaries for which the fiscal year end is in December, it shall be the 12-month period from January to December.
Therefore, the forecasts will not list rates of fluctuation in comparison to the same period of the previous year for the entire
fiscal year.

* Notes(1) Changes in significant subsidiaries during the period (changes in scope of consolidation): None
(2) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes to accounting policies accompanying revision to accounting standards, etc.
: None2) Changes to accounting policies other than 1.
: None3) Changes to estimates in accounting: None4) Revised restatement: None(3)Number of shares outstanding (ordinary stock)
1.
2.
3.

Number of shares outstanding at endof term (including own stock)

As of Mar. 31,
74,063,600
73,298,800
As of Mar. 31, 20192020
sharesshares
As of Mar. 31,
2,957,970
2,990,012
Number of own shares at end of term
As of Mar. 31, 20192020
sharessharesAverage number of shares outstanding
As of Mar. 31,
70,600,893
70,750,736
As of Mar. 31, 2019
during term (quarterly total)
2020
sharesshares(Note) This company implemented a stock split at a rate of 2 shares per 1 share of ordinary stock with an effective date ofJanuary 1st, 2020. We have calculated the “Average number of shares outstanding during term” for March 2019
assuming that said stock split was conducted at in the previous consolidated fiscal year.

－

2 －(Refer to)Summary of Non-consolidated Financial Results

1. Non-consolidated Financial Results for the Fiscal Year Ended March 31, 2020 (April 1, 2019 – March 31, 2020)(1) Non-consolidated operating results（Percentages represent year-on-year changes）
Net sales

Fiscal year ended
Mar. 31, 2020
Fiscal year ended
Mar. 31, 2019

Millions ofyenOperating profit％

Millions ofyen

12,274

6.6

11,517(6.3)

Net income per share

Ordinary profit

Net income％

Millionsof yenMillions of
yen

％

％

1,441

(39.4)

2,047(32.1)

1,301(29.0)

2,378(17.2)

3,016(12.1)

1,833(19.5)

Diluted net income pershare
Yen 100ths of a yen

Yen 100ths of a yen
Fiscal year ended
18.44
18.19
Mar. 31, 2020
Fiscal year ended
25.92
25.54
Mar. 31, 2019
(Note) This company implemented a stock split at a rate of 2 shares per 1 share of ordinary stock with an effective date of January
1st, 2020. We have calculated "net income per share" and " Diluted net income per share "assuming that said stock split was
conducted at the beginning of previous fiscal year.

(2) Non-consolidated financial position
Total assets
As of Mar. 31, 2020
As of Mar. 31, 2019
(Refer to)
Shareholders’ equity

Net assets

Millions of yen
22,104
21,265
As of Mar.
31, 2020

16,831

Capital adequacy ratio

Millions of yen
16,923
15,962Millions of
As of Mar.
31, 2019
yen

％
76.1
74.5
15,830Net assets per share
Yen 100ths of a yen

236.71225.21Millions ofyen* The current financial report is not subject to audit by certified public accountants or audit firms.
* Explanation of appropriate use of earnings forecasts, and other special items
Note concerning forward-looking statements
Estimates of future performance in this report are based on assumptions judged to be valid and information

available to the Company’s management at the time the materials were prepared, but are not promises by theCompany regarding future performance. Actual results may differ significantly from these forecasts for a numberof reasons. Please refer to “1. Overview of Results of Operations, (4) Outlook” on page 5 for forecast assumptions
and notes of caution for usage.

－

3 －TABLE OF CONTENTS OF ATTACHED MATERIALS
1. OVERVIEW OF MANAGEMENT PERFORMANCE, ETC ----------------------------------------------------- 5(1) OVERVIEW OF MANAGEMENT PERFORMANCE IN THE CURRENT PERIOD --------------------------------------- 5(2) OVERVIEW OF FINANCIAL POSITION IN THE CURRENT PERIOD ------------------------------------------------- 6(3) CASH FLOWS ---------------------------------------------------------------------------------------------------- 7(4) OUTLOOK ------------------------------------------------------------------------------------------------------- 7
2. BASIC APPROACH TO THE SELECTION OF ACCOUNTING STANDARDS ------------------------------ 8
3. CONSOLIDATED FINANCIAL STATEMENTS AND MAJOR EXPLANATORY NOTES ------------------- 9(1) CONSOLIDATED BALANCE SHEET ------------------------------------------------------------------------------- 9(2) CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME-------------------------------------------------------------------------------------------------------------------- 11(3) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ------------------------------------------------------ 14(4) CONSOLIDATED STATEMENT OF CASH FLOWS --------------------------------------------------------------- 16(5) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ------------------------------------------------------- 18－

4 －1. Overview of management performance, etc.
(1) Overview of management performance in the current period
Although the Japanese economy during the consolidated accounting period concerned, backed by improvementsin employment and income environments, had transitioned toward gradual recovery, the novel coronavirus
pandemic has started to have a major economic impact, and prospects have become uncertain within industries
related to healthcare (clinics and pharmacies) and long-term care/ welfare as well.
In the pharmacy industry, our main clients, major pharmacy chains and drug store chains have been expanding
business scale and revenue through M&A, and it is thought that there will be a prolonged period of even more
intense competition as the industry becomes dominated by a small number of large companies. Prescriptions arebeing issued for longer periods of time due to the novel coronavirus pandemic, which has reduced the number ofprescription slips. In addition, revisions to the medical system were conducted in April 2020, and although thesewere not as extensive as the previous revisions, harsh conditions are expected to continue.
In this environment, shifting our business model in October 2018 has enabled us to concentrate administrative
resources with the aim of moving further toward a subscription business model, and we are greatly contributing to
reducing the operating costs of our customers by providing products and services with high added value at lower
prices.
In regard to “MAPs for CLINIC,” a diagnostic support system for clinics from October 2019, we commenced
shipping from Osaka and Tokyo and are in turn expanding operations into other administrative districts. We havereceived high praise from customers that have used to service. In regard to “MAPs for PHARMACY,” our pharmacyoriented business support system, we commenced shipping from Osaka from February 2020 and are in turnexpanding operations into other administrative districts. We have also begun installations at pharmacies that
newly start their business. In addition, we have begun development of “MAPs for NURSING CARE,” andexpectations from the market have further increased as we work to provide support for improving the quality ofclinicians, pharmacists and nursing care/welfare service providers through the functions possessed by our “MAPs
Series,” a cloud-based system that integrates other systems within the health care field.
Also, we conducted business collaboration with Internet Infinity Inc. in March 2020. Our Group coordinated with
“Care Management Online,” Japan’s largest dedicated site for care managers which is operated by Internet Infinity
Inc. We promoted online marketing aimed at introducing long-term care/welfare systems provided by our Group.
The aforementioned site provides care manager-focused information as well as a variety of other contents, andcoordination between the site and the long-term care/welfare systems provided by our Group will support further
improvements in productivity for the long-term care/welfare service facilities and offices that are customers of ourGroup.
In addition, there was a surge in demand for hardware replacement accompanying Microsoft’s termination of
support for Windows7 on January 14, 2020, which contributed to an increase in sales during consolidated accounting
period.
As a result, our performance was 14,023 million yen in sales (a 6.8% increase compared to the same period in theprevious year) 1,583 million yen in operating profits (a 39.6% decrease) 2,179 million yen in ordinary profits (a 32.9%
decrease), and 1,393 million yen in quarterly net income attributable to shareholders in parent company (a 29.3%
decrease).
We achieved our planned sales and operating profits. In comparison with the same period in the previous year,
sales increased due to an increase in hardware replacements due to the termination of support for Windows 7 aswell as due to receipt of business from Janis Corporation in the long-term care/welfare system business andacquisition of M-Win Soft Co., Ltd. as a subsidiary and major factors behind the decrease in profits are a switch inhardware maintenance from maintenance conducted by us to maintenance conducted by manufactures
accompanying our change in business model as well as a change in sales price to further reduce customer burden.
By-segment results are as follows. In addition, we have changed the description of “IT Systems for Long-termCare/Welfare” belonged to “other business” as the report segment owing to the increasing quantitative importancefrom this 3rd quarter consolidated fiscal period. The results compared to the same period in the previous year were
published according to the part of report segment of this 3rd quarter consolidated cumulative period.
(IT Systems and Related Business for Pharmacies)
Regarding IT systems and related business for pharmacies, we have continued to strengthen our approaches topharmacy chains and our sales channels through OEM provision, etc., and we have focused our efforts on expanding
our market share relating to systems for pharmacies.
－

5 －We also received numerous referrals regarding “MAPs for PHARMACY,” our pharmacy-oriented business support
system, which has commenced shipping. The number of times that the trial version has been downloaded is alsosteadily increasing.
Under such circumstances, the number of systems sales and the amount of system usage fee sales increased
compared to the same period in the previous year. As a result, we achieved our planned sales and operating profits.
Consequently, IT Systems and Related Business for Pharmacies for this consolidated cumulative year resulted
in 10,823 million yen in sales (a 3.3% increase compared with the same period in the previous year) and 1,336
million yen in operating profits (a 30.2% decrease).
(IT Systems and Related Business for Clinics)
Regarding IT Systems and Related Business for Clinics, in order to expand our nation-wide sales channels, wehave been cultivating the clinic market by taking a broad approach using online marketing as well as conventional
methods. Furthermore, we have continued to focus efforts on sales of the medical accounting systems "MRN (*1)
Clerk Style" as well as the electronic medical records systems "MRN Karte Style" and "Ortia."
Customers have begun full-scale operation of “MAPs for CLINIC,” our diagnostic support system for clinics, andwe are receiving high praise from them. We are actively utilizing online marketing, and an increasing number ofpeople are requesting materials and registering for our e-zine. Customer interest is growing, and sales are increasingbullishly.
Billing sales are increasing smoothly due to a steady increase in the number of customers due to introduction of“MAPs for CLINIC,” but operating profits have dropped in comparison with the same period of the previous year.
The main reason for this is because we have provided systems at sales prices that reduced the burden on customers.
Consequently, IT Systems and Related Business for Clinics in the current consolidated cumulative year resulted
in 1,881 million yen in sales (a 10.4% increase from the same period in the previous year) and 161 million yen in
operating profits (a 32.7% decrease).
(*1) MRN: Medical Recepty NEXT(IT Systems and Related Business for Long-term Care/Welfare)
Regarding IT Systems for nursing care/welfare, we reorganized our sales scheme and restructured our systems
for achieving future growth. We commenced development of “MAPs for NURSING CARE,” and we are working
toward achieving synergy with clinics and pharmacies. In addition, in regard to long-term care/welfare-related
systems, we changed initial sales from five-year gross sales to monthly sales. Also, operating losses were due to theeffects of transitioning to a subscription business model.
Consequently, IT Systems and Related Business for Long-term Care/Welfare for this consolidated cumulative year
resulted in 497 million yen in sales (previous period : 85 million yen in sales) and 348 million yen in operating losses(previous period: 129 million yen in operating losses).
(Other businesses)
Sales and operating profits in our pharmacy operation business have been according to plan. Our sports gyms andnursery schools were closed during the consolidated accounting period concerned.
Furthermore, in the "commissioned project to install an online qualification checking system into the receipt creation
support system for pharmacies," with which we were commissioned by the Hiroshima Branch of the Japan Health
Insurance Association (Kyokaikenpo), we extended the initial contract periods to continue providing the service.
At our company, we are proactively engaged in the realization of electronic prescriptions and research anddevelopment as well as verification projects relating to EHR (*2), in order to contribute to future developments in thehealthcare industry. In regard to "infectious disease outbreak detection services," a joint research project between theJapan Medical Association, , and the Japan Pharmaceutical Association, the number of pharmacies using the services
were beyond 12,000 nationwide.
Consequently, other business for this consolidated cumulative year resulted in 934 million yen in sales (a 4.4%
decrease compared to the same period in the previous year) and 127 million yen in operating profits (a 2.8% decrease).
(*2) EHR: Electronic Health Record(2) Overview of financial position in the current period－

6 －(Assets)
Current assets at the end of this consolidated fiscal year were 11,556 million yen, a 626 million yen decrease
compared to the end of the previous consolidated fiscal year. Primarily, this is due to the fact that, although thecompany paid corporate taxes, etc. and allotted year-end dividends, there was a 1,283 million yen increase in cash
and savings due to smooth collection of accounts receivable, even though there was a 336 million yen decrease innotes receivables and accounts receivable. Fixed assets were 11,894 million yen, a 429 million yen increase comparedto the end of the previous consolidated fiscal year. This is due mainly to increase software a 1,562 million yen andto a decrease accompanying a 868 million yen software in progress and a 194 million yen depreciation in investment
real estate depreciation and a 113 million yen depreciation in goodwill.
As a result, total assets were 23,451 million yen, a 1,055 million yen increase compared to the end of the previous
consolidated fiscal year.
(Liabilities)
Current liabilities at the end of this consolidated fiscal year were 3,816 million yen, a 150 million yen increase
compared to the end of the previous consolidated fiscal year. This was primarily due to a increase of 482 million yen
in deferred income for maintenance service, 292 million yen decreased in accrued corporate taxes due to a reduction
in taxable income and a decrease of 73 million yen in notes payable . Fixed liabilities were 1,959 million yen, a 152
million yen decrease compared to the end of the previous consolidated fiscal year. This is due mainly to respective
decreases of 75 million yen in provision for product warranties due to the transfer of maintenance activities tomanufacturers was promoted.
As a result, total liabilities were 5,775 million yen, a 1 million yen decrease compared to the end of the previous
consolidated fiscal year.
(Net assets)
Net assets at the end of this consolidated fiscal year were 17,676 million yen, a 1,057 million yen increase
compared to the end of the previous consolidated fiscal year. This is due mainly to an increase of 724 million yen in
earned surplus due to bullish performance and respective increase on 142 million yen in capital and 250 million yen
in capital surplus due to exercise of subscription rights and decrease on 36 million yen in treasury stock due toacquisition of treasury stock.
As a result, our capital adequacy ratio was 75.0% (compared to 73.6% at the end of the previous consolidated
fiscal year).

(3) Cash flows
The amount of cash and cash equivalents during the consolidated accounting period concerned (hereinafter“funds”) totaled 8,770 million yen, an increase of 1,284 million yen over the end of the previous consolidated
accounting period.
The status of each type of cash flow during the consolidated accounting period concerned as well as their main
factors are as follows.
(Net cash provided by (used in) operating activities)
Funds acquired through sales activities totaled 2,300 million yen (1,846 million yen in income in theprevious period). Although net profits for the fiscal year concerned prior to adjustment for taxes, etc. totaled
2,131 million yen accompanying robust performance during the consolidated accounting period concerned, thiswas mainly due to the fact that payments of corporate taxes, etc. came to 1,030 million yen and collection ofreceivables proceeded smoothly.
(Net cash provided by (used in) investing activities)
Funds expended as a result of investment activities totaled 343 million yen (894 million yen in expendituresin the previous period). Although income from rental of investment properties totaled 1,033 million yen, thiswas mainly due to the fact that expenditures due to acquisition of intangible fixed assets relating to softwaredevelopment came to 860 million yen, expenditures due to acquisition of tangible fixed assets came to 256
million yen, and expenditures due to rental of investment properties came to 234 million yen.
(Net cash provided by (used in) financial activities)
Funds expended as a result of financial activities totaled 668 million yen (1,982 million yen in expendituresin the previous period). Although income from issuing shares totaled 249 million yen, this was mainly due tothe fact that paid dividends came to 668 million yen, expenditures due to repayment of long-term loans came to
117 million yen, and expenditures due to acquisition of treasury shares came to 96 million yen.

(4) Outlook
Looking forward, prescriptions are being issued for longer periods of time due to the novel coronavirus
pandemic, which has reduced the number of prescription slips. In addition, revisions to the medical systemwere conducted in April 2020, and although these were not as extensive as the previous revisions, harshconditions are expected to continue. We expect that actions will continue to be taken to control medical fees
overall within the country. The government has expressed its intention to thoroughly promote ICT in medical－ 7 －related fields, and demand for coordination of information among various professions, including in the longterm care/welfare fields, is expected to rise higher than ever before. In our medical and pharmacy businesses,
our Group will provide a higher level of support to medical providers to improve safety and business efficiency
by sharing information through the “MAPs Series,” our shared information system base.
In our long-term care/welfare businesses, we will be active in the disability welfare business field, thefacility-based service field, and the service field targeting Community-based Integrated Care centers, and wewill continue to support service providers in the long-term care service business field, disability welfare
business field, and comprehensive support business field.
As was publically announced on March 10, 2020, the Company will implement changes to the fiscal year end
on the condition that the matter is approved at the regular meeting of shareholders scheduled for June 16,
2020. The 38th fiscal year (April 1 to December 31, 2020) will be a 9-month fiscal period, and we expect 10,092
million yen in sales, 1,127 million yen in operating profits, 1,556 million yen in ordinary profits, and 1,082
million yen in net income for the period attributable to parent company shareholders.
In addition, in regard to the Interim Management Plan publicized on May 8, 2018, in consideration of thenovel coronavirus pandemic, if changes are necessary, we intend to release a revised plan as soon as it isdeemed possible to formulate such a plan. The aforementioned performance forecasts are calculated based on
information available as of the date of release of this document. Actual performance may vary from predictedvalues due to various future factors.

2. Basic Approach to the Selection of Accounting Standards
The EM SYSTEMS Group currently applies Japanese accounting standards for its consolidated financial
statements. We will take suitable actions with regard to the application of International Financial ReportingStandards (IFRS) by taking into account associated factors in Japan and other countries.

－

8 －3. Consolidated financial statements and major explanatory notes(1) Consolidated balance sheet(Units: millions of yen)
As of March 31, 2019

As of March 31, 2020

AssetsCurrent assets
Cash on hand and in banks
Notes and accounts receivable
Merchandise and products
Raw materials and supplies
OthersAllowance for bad debts
Total current assets
Fixed assets
Tangible fixed assets
Buildings and structures
Accumulated depreciation
Buildings and structures (net)Land
Lease assets
Accumulated depreciation
Lease assets (net)
Rental assets
Accumulated depreciation
Rental assets (net)
Construction in progress
Others
Accumulated depreciation
Others (net)Total tangible fixed assets
Intangible fixed assets
Software
Software in progress
Goodwill
OthersTotal intangible fixed assets
Investments and other assets
Investment securities
Investment real estate
Accumulated depreciation
Investment real estate (net)
Allowance for bad debts
Deferred tax asset
Net defined benefit asset
Other
Allowance for bad debts
Total investments and other assets
Total fixed assets
Total assets

－

9 －

7,487
2,456
164
0
842
(20)
10,930

8,770
2,119
181
0
500
(16)
11,556

1,495
(758)
737
589
143
(86)
57
47
(36)
10
210
546
(476)
70
1,676

1,445
(747)
697
562
125
(94)
30
50
(42)
8
165
813
(531)
282
1,747

82
1,172
570
149
1,974

1,645
303
456
127
2,532

7
9,960
(3,137)
6,823
145
572
123
143
(0)
7,814
11,46522,39619
9,960(3,331)
6,628
139
524
115
188
(0)
7,615
11,89423,451

(Units: millions of yen)
As of March 31, 2019

Liabilities
Current liabilities
Notes and accounts payable
Current portion of long-term loans payable
Accounts payable-other
Lease obligations
Income taxes payable, etc.
Accrued consumption taxes
Provision for bonuses
Provision for points card certificates
OthersTotal current liabilities
Non-current liabilities
Long-term loans payable
Lease obligations
Net defined benefit liability
Provision for product warranties
Long-term guarantee deposited
Long-term Accounts payable-otherTotal non-current liabilities
Total liabilities
Net assets
Shareholder's equity
Capital stock
Capital surplus balance
Retained earnings
Treasury stock
Total shareholder's equity
Cumulative amount of other comprehensive
incomeForeign currency translation adjustments
Remeasurements of defined benefit plans
Total other cumulative comprehensive
incomeSubscription rights to shares
Total net assets
Total liabilities and net assets

－

10 －

As of March 31, 2020

1,011
104
516
34
530
15
399
4
1,049
3,665

937
34
578
33
237
100
358
4
1,531
3,816

34
53
1,029
221
721
7
2,112
5,777

－
20
1,041
146
721
16
1,959
5,775

2,558
2,935
12,140(1,097)
16,5362,700
3,185
12,864(1,125)
17,625

34
(81)

27
(68)

(46)

(40)

128
16,61822,39691
17,67623,451

(2) Consolidated statements of income and consolidated statements of comprehensive income(Consolidated statements of income)(Units: millions of yen)Previous fiscal year
(From April 1, 2018
To March 31, 2019)

Sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Promotion expenses
Packing and transportation expenses
Advertising expenses
Provision of allowance for doubtful accounts
Provision for product warranties
Directors’ compensations
Salaries and allowances
Bonuses
Provision for bonuses
Share-based compensation expenses
Retirement benefit expenses
Legal welfare expenses
Traveling and transportation expenses
Communication expenses
Depreciation
Amortization of goodwill
Rents
Research and development expenses
Other
Total selling, general and administrative
expenses
Operating profit
Non-operating income
Interest income
Rent income of real estate
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Commission fee
Rent expenses on real estates
Amortization of share issuance cost
Miscellaneous loss
Total non-operating expenses
Ordinary profit

－

11 －

Current fiscal year
(From April 1, 2019
To March 31, 2020)

13,133
5,723
7,410

14,023
6,971
7,051

21
23
92
(0)
91
259
1,823
226
314
46
115
366
132
75
91
59
226
13
808

20
29
225
(3)
4
260
2,125
218
322
61
120
404
151
69
48
113
227
48
1,018

4,787

5,468

2,622

1,583

0
1,020
10
1,031

0
1,022
17
1,040

1
8
381
－
14
405
3,248

0
5
429
－
8
444
2,179

(Units: millions of yen)Previous fiscal year
(From April 1, 2018
To March 31, 2019)

Extraordinary income
Gain on sales of non-current assets
Gain on reversal of share acquisition rights
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Loss on sales of non-current assets
Impairment loss
Loss on liquidation of subsidiaries andassociates
Expenses for advanced repayment of loans
loss on revaluation of investments in securities
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
Net income
Profit attributable to owners of parent

0
0
20

0
1
4
5
4
－
31

－

－

－
198
218
3,030
1,089
(30)
1,058
1,971
1,971

－
－

－
－
－

－

12 －

Current fiscal year
(From April 1, 2019
To March 31, 2020)

53
2,131
725
12
738
1,393
1,393

（Consolidated statements of comprehensive income）(Units: millions of yen)Previous fiscal year
(From April 1, 2018
To March 31, 2019)

Net income
Other comprehensive income
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income（Breakdown）
Comprehensive income concerning parent
company shareholders
Comprehensive income concerning
non-controlling shareholders

－

13 －

Current fiscal year
(From April 1, 2019
To March 31, 2020)

1,971

1,393

(13)
(15)
(29)
1,942

(7)
13
5
1,399

1,942

1,399

－

－

(3) Consolidated Statement of Changes in Equity
Previous fiscal year (From April 1st, 2018 to March 31st, 2019)(Units: millions of yen)
Shareholders’ equity

Capital stock
Balance at beginning ofcurrent period
Changes of items
during period
Exercise of shareacquisition rights

Capital surplus Retained earnings Treasury shares

2,445

2,808

112

112

10,878

（208)

Total
shareholders’equity15,924225

Dividends of surplus

（710)

（710)

Profit attributable toowners of parent

1,971

1,971

Purchase of treasury
shares
Disposal of treasury
shares

14

（903)

（903)

15

29

Change of scope of
consolidation
Net changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

112

127

1,261

（888)

612

2,558

2,935

12,140（1,097)

16,536

Accumulated other comprehensive income
Total
Foreign currency Remeasurements accumulatedtranslationof defined benefit otheradjustment
planscomprehensive
incomeBalance at beginning ofcurrent period
Changes of items
during period
Exercise of shareacquisition rights

48

（66)

（17)

Share acquisition
Total net assets
rights145

16,052

225

Dividends of surplus（710)

Profit attributable toowners of parent

1,971

Purchase of treasury
shares（903)

Disposal of treasury
shares29

Change of scope of
consolidation-

Net changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

（13)

（15)

（29)

（17)

（46)

（13)

（15)

（29)

（17)

566

34

（81)

（46)

128

16,618－14 －Current fiscal year (From April 1st, 2019 to March 31st, 2020)(Units: millions of yen)
Shareholders’ equity

Capital stock
Balance at beginning ofcurrent period
Changes of items
during period
Exercise of shareacquisition rights

Capital surplus Retained earnings Treasury shares

2,558

2,935

142

142

12,140（1,097)

Total
shareholders’equity16,536285

Dividends of surplus

（668)

（668)

Profit attributable toowners of parent

1,393

1,393

Purchase of treasury
shares
Disposal of treasury
shares

107

（96)

（96)

67

175

Change of scope of
consolidation
Net changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

142

250

724

（28)

1,088

2,700

3,185

12,864（1,125)

17,625

Accumulated other comprehensive income
Total
Foreign currency Remeasurements accumulatedtranslationof defined benefit otheradjustment
planscomprehensive
incomeBalance at beginning ofcurrent period
Changes of items
during period
Exercise of shareacquisition rights

34

（81)

Share acquisition
Total net assets
rights（46)

128

16,618285

Dividends of surplus（668)

Profit attributable toowners of parent

1,393

Purchase of treasury
shares（96)

Disposal of treasury
shares

175

Change of scope of
consolidation-

Net changes of items
other thanshareholders’ equity
Total changes of items
during period
Balance at end ofcurrent period

（7)

13

5

（36)

（31)

（7)

13

5

（36)

1,057

27

（68)

（40)

91

17,676－15 －(4) Consolidated Statement of Cash Flows(Units: millions of yen)Previous fiscal year
(From April 1, 2018
To March 31, 2019)

Cash flows from operating activities
Profit before income taxes
Depreciation
Amortization of goodwill
Amortization of share issuance cost
Impairment loss
Loss on liquidation of subsidiaries and associates
Expenses for advanced repayment of loans(Gains) and losses on revaluation of investments insecurities
Decrease (increase) in net defined benefit asset
Increase (decrease) in net defined benefit liability
Increase (decrease) in provision for productwarranties
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for point cardcertificates
Increase (decrease) in allowance for doubtful
accounts
Interest and dividend income
Rent income of real estate
Expenses of real estate rentInterest expenses
Loss on retirement of non-current assets
Share-based compensation expenses
Gain on reversal of share acquisition rights
Loss (gain) on sales of non-current assets
Decrease (increase) in notes and accounts
receivable-trade
Decrease (increase) in inventories
Decrease (increase) in other current assets
Increase (decrease) in notes and accounts payabletrade
Increase (decrease) in accrued consumption taxes
Increase (decrease) in other current liabilities
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities

－

16 －

Current fiscal year
(From April 1, 2019
To March 31, 2020)

3,030
485
59
－
20
－
－

2,131
539
113
－
31
－
－

198

－

(13)
111

7
12

6

(75)

49

(41)

0

0

(0)

(0)

(0)
(1,020)
186
1
0
51
－
－

(0)
(1,022)
234
0
4
66
(1)
－

(248)

355

(33)
(41)

(16)
396

239

(80)

(100)
308
(118)
3,171
0
(1)
(1,323)
1,846

83
514
85
3,331
0
(0)
(1,030)2,300

(Units: millions of yen)Previous fiscal year
(From April 1, 2018
To March 31, 2019)

Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant andequipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from purchase of investments in
subsidiaries resulting in change in scope of
consolidation
Payments from transfer of business
Proceeds from rental of real estate for investment
Payments for rental of real estate for investment
Collection of loans receivable
Payments of loans receivable
Proceeds from guarantee deposits received
Repayments of guarantee deposits received
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
Repayments of lease obligations
Proceeds from issuance of common shares
Purchase of treasury shares
Cash dividends paid
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
Increase in cash and cash equivalents from newly
consolidated subsidiary
Cash and cash equivalents at end of period

－

17 －

Current fiscal year
(From April 1, 2019
To March 31, 2020)

(254)

(256)

－

－

(970)
－

(860)
(10)

58

3

(125)
1,019
(186)
8
(458)
8
(1)
7
(894)

－
1,033
(234)
13
(15)
－
(0)
(16)
(343)

－
(517)
(48)
196
(903)
(708)
(1,982)

－
(117)
(34)
249
(96)
(668)
(668)

(13)

(4)

(1,042)
8,528

1,284
7,486

－

－

7,486

8,770

(5) Notes to Consolidated Financial Statements
Going Concern Assumption
Not applicable.
Segment and Other Information
Segment information
1. Overview of reportable segment
Segments used for financial reporting are the EM SYSTEMS Group’s constituent units forwhich separate financial information is available and for which the Board of Directors performs
periodic studies for the purposes of determining the allocation of resources and evaluating
performance.
The EM SYSTEMS Group consists of business units organized according to product categories
and business operations that are divided among different companies. For the purpose of financial
reporting, there are four reportable segments: IT Systems and Related Business for Pharmacies,
IT Systems and Related Business for Clinics, IT Systems for Long-term care/welfare and Other
Businesses.
Major products for each reportable segment are as follows:
Reportable segment

Major products

IT Systems and Related
Business for Pharmacies

Development and sales of systems for pharmacies

IT Systems and Related
Business for Clinics

Development and sales of systems for clinics

IT Systems for Long-termcare/welfare

Development and sales of systems for nursing care service providers

Other Businesses

management of a fitness club, nursery school and pharmacy

2. Calculation methods for net sales, profit/loss, assets, liabilities and other items for each reportable segment
The accounting methods for reportable segments comply with accounting policies used for the
preparation of the consolidated financial statements.
Profit for reportable segments is operating profit figures.
Inter-segment sales and transfers are based on prevailing market prices.

－

18 －

3. Information related to net sales, profit/loss, assets, liabilities and other items for each reportable segment
Previous fiscal year (From April 1st, 2018 to March 31st, 2019)(Units: millions of yen)

Reportable segment

Amounts
recorded in

IT Systems

IT Systems

and Related

and Related

Business for

Business for

Pharmacies

Clinics

IT Systems
for Long-termcare/welfare

Other
Businesses

Adjustment

Total

consolidated
financialstatements(Note)Net sales
External sales

10,472

1,704

85

972

13,234(100)

13,133

4

－

－

5

9

(9)

－

10,476

1,704

85

977

13,243(109)

13,133

Segment profit

2,389

239

(129)

130

2,630

(7)

2,622

Segment assets

4,219

1,155

1,093

590

7,058

15,33722,396

Depreciation

187

62

34

5

290

195

485

Increase in property, plant andequipment and intangible assets

717

477

561

2

1,758

－

1,758

Inter-segment sales and transfers
Total

Other items

Note: Segment profit is adjusted to be consistent with operating profit recorded in the consolidated financial
statements.
Current fiscal year (From April 1st, 2019 to March 31st, 2020)(Units: millions of yen)

Reportable segment

Amounts
recorded in

IT Systems

IT Systems

and Related

and Related

Business for

Business for

Pharmacies

Clinics

IT Systems forLong-termcare/welfare

Other
Businesses

Adjustment

Total

consolidated
financialstatements(Note)Net sales
External sales

10,821

1,881

497

914

14,115(92)

14,023

1

－

－

20

21

(21)

－

10,823

1,881

497

934

14,137(114)

14,023

Segment profit

1,667

161

(348)

127

1,607

(24)

1,583

Segment assets

3,317

722

1,438

753

6,231

17,22023,451

Depreciation

144

85

108

6

344

194

539

Increase in property, plant andequipment and intangible assets

734

412

282

2

1,432

－

1,432

Inter-segment sales and transfers
Total

Other items

Note: Segment profit is adjusted to be consistent with operating profit recorded in the consolidated financial
statements.
In addition, we have changed the description of “IT Systems for Long-term Care/Welfare” belonged to “otherbusiness” as the report segment owing to the increasing quantitative importance from this 3rd quarter
consolidated fiscal period.

－

19 －

4. Reconciliation of amounts recorded in consolidated financial statements with total reportable segments(Units: millions of yen)

Net sales

Previous fiscal year

Total for reportable segments
Transfer to non-operating income
Eliminations for inter-segment
transactions
Net sales on the consolidated
financial statements

Current fiscal year

13,243

14,137

(100)

(92)

(9)

(21)

13,133

14,023(Units: millions of yen)

ProfitPrevious fiscal year

Total for reportable segments
Transfer to non-operating income
Eliminations for inter-segment
transactions
Net sales on the consolidated
financial statements

Current fiscal year
2,630

1,607

(25)

(27)

17

3

2,622

1,583
(Units: millions of yen)

AssetsPrevious fiscal year

Total for reportable segments

Current fiscal year
7,058

6,231

Transfer to non-operating income
16,486
18,420Eliminations for inter-segment(1,148)(1,199)transactions
Net sales on the consolidated
22,39623,451
financial statements
Note: Corporate assets mainly include cash and deposits and real estate for investment that are not attributableto reportable segments.
(Units: millions of yen)Amounts recorded inconsolidated financial
statements

Adjustment

Total reportable segment
Other items

Depreciation
Increase in property, plantand equipment andintangible assets

Previous
fiscal year

Current
fiscal year

Previous
fiscal year

Current
fiscal year

Previous
fiscal year

Current
fiscal year

290

344

195

194

485

539

1,758

1,432

－

－

1,758

1,432

Related information
Previous fiscal year (Apr. 1, 2018 – Mar. 31, 2019)
1. Information about products and services
Descriptions of products and services are omitted because this information is presented in the segment
information.
2. Geographical information(1) Net sales
This information is omitted because sales to external customers in Japan accounted for more than 90% of
net sales in the consolidated statement of income.
(2) Property, plant and equipment
This information is omitted because property, plant and equipment in Japan exceeded 90% of property,
plant and equipment in the consolidated balance sheet.
3. Information of specific major customer
This information is omitted because no specific customers accounted for 10% or more of net sales in the
consolidated statement of income.
－20 －Current fiscal year (Apr. 1, 2019 – Mar. 31, 2020)
1. Information about products and services
Descriptions of products and services are omitted because this information is presented in the segment
information.
2. Geographical information(1) Net sales
This information is omitted because sales to external customers in Japan accounted for more than 90% of
net sales in the consolidated statement of income.
(2) Property, plant and equipment
This information is omitted because property, plant and equipment in Japan exceeded 90% of property,
plant and equipment in the consolidated balance sheet.
3. Information of specific major customer
This information is omitted because no specific customers accounted for 10% or more of net sales in the
consolidated statement of income.
【Impairment loss of non-current assets by reportable segment】
Previous fiscal year (Apr. 1, 2018 – Mar. 31, 2019)(Units: millions of yen)
IT Systems andRelated Businessfor Pharmacies

IT Systems andRelated Businessfor Clinics

IT Systems for Longterm care/welfare

Other Businesses

4-

Impairment loss
13
2
Current fiscal year (Apr. 1, 2019 – Mar. 31, 2020)

Total

20

(Units: millions of yen)

Impairment loss

IT Systems andRelated Businessfor Pharmacies

IT Systems andRelated Businessfor Clinics

IT Systems for Longterm care/welfare

Other Businesses

15

2

13

-

Total

31

【Amortization of goodwill and unamortized balance by reportable segment】
Previous fiscal year (Apr. 1, 2018 – Mar. 31, 2019)(Units: millions of yen)Amortization forthe period

IT Systems andRelated Businessfor Pharmacies

IT Systems andRelated Businessfor Clinics

34

-

2

22

59

-

372

181

570

IT Systems forLong-termcare/welfare

Other Businesses

Total

Unamortizedbalance at the16
period-end
Current fiscal year (Apr. 1, 2019 – Mar. 31, 2020)(Units: millions of yen)Amortization forthe period
Unamortizedbalance at the

IT Systems andRelated Businessfor Pharmacies

IT Systems andRelated Businessfor Clinics

16

-

75

22

113

-

-

297

158

456

period-end【Gain on negative goodwill by reportable segment】
Previous fiscal year (Apr. 1, 2018 – Mar. 31, 2019)
Not applicable.
Current fiscal year (Apr. 1, 2019 – Mar. 31, 2020)
Not applicable.
－

21 －IT Systems forLong-termcare/welfare

Other Businesses

Total

（Per Share Information）(From(Units: Yen 100ths of a yen)Previous fiscal year
April 1, 2018 To March 31, 2019)

Current fiscal year
April 1, 2019 To March 31, 2020)(From

Net assets per share

234.53

Net assets per share

247.30Net income per share

27.87

Net income per share

19.74

Diluted net income per share

27.46

Diluted net income per share

19.47

Notes: 1. The Company conducted a common stock split according to a ratio of 1:2 effective on January 1, 2020.
Net assets per share, net income per share and diluted net income per share are calculated as if thisstock split had taken place at the beginning of the fiscal year ended March 31, 2019.
2. The basis of calculating net income per share and diluted net income per share is as follows:(Units: millions of yen)Previous fiscal year
(From April 1, 2018
To March 31, 2019)

Current fiscal year
(From April 1, 2019
To March 31, 2020)

Net income per share
Profit attributable to owners of parent

1,971

1,393

Amounts not available to common stock
shareholders

－

－

1,971

1,393

70,750,736

70,600,893－－

1,054,958

967,774

Profit attributable to owners of parent
available to common stock
Average number of shares of common stock
outstanding during the period (Shares)

Diluted net income per share
Adjusted profit attributable to owners ofparentIncrease in the number of shares ofcommon stock (Shares)－

Summary of potential stock not included in
the calculation of “Diluted net income per－share” since there was no dilutive effect（Subsequent Events）
Not applicable.

This financial report is solely a translation of the Company’s Kessan Tanshin (including attachments) in Japanese,
which has been prepared in accordance with accounting principles and practices generally accepted in Japan, for theconvenience of readers who prefer an English translation.
－

22 －