Kyoritsu Maintenance Co., Ltd.

(Securities Code: 9616)

Summary of Consolidated Financial Results
for the Second Quarter of the Fiscal YearEnding March 31, 2024
［JGAAP］
November 2023

1

Summary of Consolidated Financial Results for the Second Quarter of the Fiscal Year Ending
March 31, 2024 [based on Japanese GAAP]
November 9, 2023
Listed exchange: Tokyo

Name of listed company
Kyoritsu Maintenance Co., Ltd.
Code
9616
URL https://www.kyoritsugroup.co.jp/
Representative(Title) President(Name) Koji Nakamura
Contact(Title) Managing Director(Name) Manabu Takaku
Scheduled filing date of Quarterly Report:
November 13, 2023
Scheduled date of start of dividend payment:
December 5, 2023
Supplementary materials for the quarterly financial results: Yes
Investor conference for the quarterly financial results: Yes (for institutional investors and analysts)

Tel +81-3-5295-7778(Rounded down to the nearest million yen)

1.

Consolidated financial results for the first six months of the fiscal year ending March 31, 2024 (April 1, 2023 to September 30,
2023)(1) Consolidated Operating Results(Percentage figures represent year-over-year changes)

Net sales

Operating income

Income (loss)
attributable to ownersof parent

Ordinary income

Millionyen%

Millionyen%

Millionyen%

Millionyen%

The six months ended September 30, 2023

98,662

18.7

8,396

112.8

8,212

117.2

4,704

105.2

The six months ended September 30, 2022

83,093

22.7

3,945

–

3,780

–

2,292

–

(Note) Comprehensive income:The six months ended September 30, 2023: 5,109 million yen (101.5%)
The six months ended September 30, 2022: 2,536 million yen (–%)

Income (loss)
per share

Diluted net income
per share

Yen

Yen

The six months ended September 30, 2023

120.61103.46The six months ended September 30, 2022

58.79

50.31

(2) Consolidated financial position
Total assets

Total net assets

Equity ratio

Net assets per share

Million yen

Million yen%

Yen

As of September 30, 2023

259,692

79,30230.5

2,032.60

As of March 31, 2023

272,308

74,57927.4

1,912.28(Reference) Shareholders’ equity: As of September 30, 2023: 79,302 million yen As of March 31, 2023: 74,579 million yen

2.

Dividends
Q1 endQ2 endYear ended March 31, 2023

Yen–

Year ending March 31, 2024–

Annual dividends
Q3 end
Yen
Yen
10.00
–

Year end

Total

Yen
12.00

Yen
22.00

20.00

36.00

16.00

Year ending March 31, 2024 (Forecast)–(Note) Revision from most recently announced dividends forecasts: Yes
See “Notice of revised forecasts of consolidated financial results and year-end dividends,” announced today (November 9, 2023), for revised
year-end dividends forecasts.

3.

Forecasted consolidated results for the fiscal year ending March 31, 2024 (April 1, 2023 to March 31, 2024)(Percentage figures represent year-over-year changes)

Net sales

Full year

Operating income

Net income
attributable to ownersof parent

Ordinary income

Net income pershare

Millionyen%

Millionyen%

Millionyen%

Million
yen

%

Yen

200,000

13.9

13,00077.4

12,000

68.6

7,000

65.0

179.42(Note) Revision from most recently announced earnings forecasts: Yes
See “Notice of revised forecasts of consolidated financial results and year-end dividends,” announced today (November 9, 2023), for revised
consolidated earnings forecasts.

2*Notes(1) Changes in major subsidiaries during the period under review (changes in specific subsidiaries accompanied by changes in thescope of consolidation): None
(2) Application of special accounting treatment in the preparation of the quarterly consolidated financial statements: Yes(Note) For details, please see “(4) Notes on Quarterly Consolidated Financial Statements, (Application of special accounting
procedures in the preparation of quarterly consolidated financial statements)” under “2. Quarterly Financial Statements
and Major Notes” on page 13.
(3) Changes in accounting policies, changes in accounting estimates, and restatements(i) Changes in accounting policies due to revision of accounting standards, etc.:

None(ii) Changes in accounting policies other than those under (i) above:(iii) Changes in accounting estimates:

None
None

(iv) Retrospective restatements:

None(4) Number of issued shares (common stock)(i) Number of issued shares at the end of
the period (including treasury shares)

As of September
30, 2023

39,219,818
sharesYear ended
March 31, 2023

39,219,818
shares(ii) Number of treasury shares at the endof the period

As of September
30, 2023

204,724
sharesYear ended
March 31, 2023

219,668
shares(iii) Average number of shares during theperiodAs of September
30, 2023

39,006,013
shares

As of September
30, 2022

38,993,815
shares*Summaries of quarterly financial results are not subject to auditing by a certified public accountant or auditing firm.
*Explanation of the appropriate use of earnings forecasts and other special notes(Note concerning forward-looking statements)
The forward-looking statements, including earnings forecasts and other future projections contained in this document are basedon information available to the Company at the time of preparation and on certain assumptions deemed reasonable by theCompany. As such, they do not constitute an assurance that the Company promises to achieve these projected results. Actual
business results may differ materially from the forecasts due to various factors.
Please see “(3) Explanation of Forecasts of Consolidated Results and Other Forward-Looking Information” under “1.
Qualitative Information on Quarterly Results” on page 6 for the assumptions used for the forecast of financial results and notes
concerning the use of the forecast of financial results.
(How to obtain supplementary materials on quarterly financial results)
Supplementary materials on quarterly financial results are posted to TDnet on the same date and to the Company website.

3

Table of contents for attached materials
1. Qualitative Information on Quarterly Results........................................................................................................................................ 5(1) Explanation of Operating Results .................................................................................................................................................... 5(2) Explanation of Financial Position .................................................................................................................................................... 6(3) Explanation of Forecasts of Consolidated Results and Other Forward-Looking Information ......................................................... 6
2. Quarterly Financial Statements and Major Notes .................................................................................................................................. 7(1) Quarterly Consolidated Balance Sheet............................................................................................................................................. 7(2) Quarterly Consolidated Income Statement and Quarterly Consolidated Statement of Comprehensive Income .............................. 9(Quarterly Consolidated Income Statement) ................................................................................................................................... 9(Six Months Ended September 30, 2023) ........................................................................................................................................ 9(Quarterly Consolidated Statement of Comprehensive Income) ................................................................................................... 10(Six Months Ended September 30, 2023) ...................................................................................................................................... 10(3) Quarterly Consolidated Cash Flow Statement ............................................................................................................................... 11(4) Notes on Quarterly Consolidated Financial Statements ................................................................................................................. 13(Notes on the going concern assumption)...................................................................................................................................... 13(Notes concerning any notable changes in shareholders’ equity) .................................................................................................. 13(Application of special accounting procedures in the preparation of quarterly consolidated financial statements) ....................... 13(Changes in accounting policies) ................................................................................................................................................... 13(Additional information) ............................................................................................................................................................... 13(Segment Information etc.) ............................................................................................................................................................ 144

1. Qualitative Information on Quarterly Results(1) Explanation of Operating Results
During the first six months of the current consolidated fiscal year, despite the reclassification of COVID-19 as a Class 5 infectious
disease and the accompanying trend toward normalization of economic activity, the outlook for the Japanese economy remained
uncertain for various reasons, including the skyrocketing energy prices and costs of raw materials associated with the protracted
Ukraine conflict and inflation spurred by yen devaluation.
Under these conditions, various factors helped the Group record recovering business performance in both the Dormitory
Business and Hotel Business. These included recovering and growing numbers of dormitory rooms under contract with foreign
students and a strong recovery of inbound visitors to Japan, whose numbers in September 2023 had recovered to 96% of the preCOVID level in September 2019 (source: Japan National Tourism Organization (JNTO) “Visitor Arrivals”), as well as theextension of nationwide measures to support tourism. These factors more than offset the negative impact of higher foodstuff andlabor costs.
As a result, the Group saw substantial earnings growth in the first six months of the current consolidated fiscal year, recording
net sales of 98,662 million yen (up 18.7% YoY), operating income of 8,396 million yen (up 112.8% YoY), ordinary income of
8,212 million yen (up 117.2% YoY), and net income attributable to owners of parent of 4,704 million yen (up 105.2% YoY).
Segment business performance is reviewed below.
(i) Dormitory BusinessIn the Dormitory Business, the Group opened 12 facilities nationwide with a total of 1,037 rooms in April. Factors including
an increase in contracts concluded with Japanese students, reflecting the high regard for safety and security measures
implemented at our dormitory facilities, and a sharp increase in contracts concluded with foreign students following the liftingof immigration restrictions, helped the Dormitory Business begin the period with an initial occupancy rate of 98.2% (up 4.7
percentage points from the previous year).
As a result, net sales were 26,183 million yen (up 5.1% YoY) and operating income was 2,964 million yen (up 32.4% YoY).
(ii) Hotel Business
The Hotel Business opened two facilities during the period under review: Natural Hotsprings Awayuki-no-yu Dormy Inn
Aomori in the Dormy Inn Business, and La Vista Kannonzaki Terrace in the Resorts Business.
Energetic sales promotions, including travel exhibitions and domestic travel campaigns, led to high occupancy rates.
Contributing background factors included the extension of nationwide measures to support tourism and growing summer
leisure demand in the domestic tourism market as well as considerable growth in inbound tourism thanks to the weak yen andresumption of and rise in international flights following the lifting of immigration restrictions. We also made progress innormalizing selling prices to cope with inflationary pressures in areas such as labor and raw materials costs.
As a result, average daily rates reached new record highs. Net sales amounted to 60,576 million yen (up 30.3% YoY) andoperating income was 7,271 million yen (up 163.8% YoY).
(iii) Comprehensive Building Management BusinessIn the Comprehensive Building Management Business, growth in remodeling projects drove net sales to 10,220 million yen(up 26.9% YoY) and operating income to 212 million yen (up 9.9% YoY).
(iv) Food Service BusinessIn the Food Service Business, despite growing numbers of contracted hotel restaurants, factors including the higher foodstuff
and labor costs resulted in net sales of 5,218 million yen (up 19.9% YoY) and operating income of 91 million yen (down
32.3% YoY).
(v) Development BusinessDespite higher revenues from the sale of real estate, the Development Business reported net sales of 618 million yen (up 5.6%
YoY) and operating income of 4 million yen (down 83.7% YoY) due to a decrease in new construction projects and otherfactors.
(vi) Other Businesses
Other Businesses consist of the Senior Life Business (management and operation of senior residences), Public Kyoritsu
Partnership (PKP) Business (services provided under contract to local governments), support business for people who live
alone, insurance agency business, comprehensive human-resource services business, financial business, and the administrative
outsourcing business. The total of these businesses resulted in net sales of 8,016 million yen (up 3.0% YoY) and operating
loss of 20 million yen (vs. operating income of 51 million yen in the same period of the previous fiscal year).

5(2) Explanation of Financial Position(i) Assets, Liabilities and Net Assets(Assets)
Total assets at the end of the second quarter of this consolidated fiscal year stood at 259,692 million yen, down by
12,615 million yen from the end of the previous consolidated fiscal year. Main factors of this decrease included declines incash and deposits.
(Liabilities)
Liabilities at the end of the second quarter of this consolidated fiscal year stood at 180,390 million yen, down by 17,338 million
yen from the end of the previous consolidated fiscal year. This was mainly due to declines in bonds payable and long-termloans payable.
(Net Assets)
Net assets at the end of the second quarter of this consolidated fiscal year stood at 79,302 million yen, up 4,722 million yen
from the end of the previous consolidated fiscal year. This was mainly due to an increase in retained earnings.
As a result, the equity ratio was 30.5%, an increase of 3.1 points from the end of the previous consolidated fiscal year.
(ii) Cash Flows
Cash and cash equivalents at the end of second quarter of this consolidated fiscal year were 38,063 million yen, decreased by
17,587 million yen from the end of the previous consolidated fiscal year.
(Cash Flows from Operating Activities)
Net cash from operating activities was 7,924 million yen, up 8,896 million yen from the same period last year due to theimpact of net income before income taxes.
(Cash Flows from Investing Activities)
Net cash used in investment activities was 16,471 million yen, up 11,940 million yen from the same period last year due tothe impact of purchase of property, plant and equipment.
(Cash Flows from Financing Activities)
Net cash used in financing activities was 9,057 million yen, up 4,189 million yen from the same period last year due to theimpact of repayments of long-term loans payable.

(3) Explanation of Forecasts of Consolidated Results and Other Forward-Looking Information
We have revised our forecasts of consolidated financial results upward for the fiscal year ending March 31, 2024 previously
announced on May 15, 2023. These revisions reflect expectations for faster than anticipated improvements in businessperformance in both the Dormitory Business and Hotel Business amid substantial improvements in the business environment.
For details, please refer to the “Notice of revised forecasts of consolidated financial results and year-end dividends,” released
today (November 9, 2023).
There have been no changes in the Medium-term Management Plan “KYORITSU Growth Vision / Rise Up Plan 2028,” forwhich the fiscal year ending March 31, 2024 is the first fiscal year.

62. Quarterly Financial Statements and Major Notes(1) Quarterly Consolidated Balance Sheet(Unit: million yen)
As of March 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Real estate for sale
Real estate for sale in process
Costs on uncompleted construction contracts
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
LandConstruction in progress
Other, net
Total property, plant and equipment
Intangible fixed assets
Investments and other assets
Investment securities
Guarantee deposits
Lease deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Deferred assets
Total assets

7

As of September 30, 2023

56,027
15,211
11,750
6,873
95
8,918
-74
98,80238,43915,792
11,617
7,479
95
8,429
-75
81,77847,64339,862
14,811
4,637
106,954
4,154

48,81041,236
16,8704,850
111,767
4,203

3,525
18,581
19,91520,082-113
61,991
173,100
405
272,308

3,892
19,211
20,375
18,215-110
61,584
177,555358
259,692

(Unit: million yen)
As of March 31, 2023
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Current portion of bonds payable
Income taxes payable
Provision for bonuses
Provision for directors’ bonuses
Provision for warranties for completed construction
Provision for loss on business withdrawal
Other
Total current liabilities
Non-current liabilities
Bonds payable
Convertible bonds with share acquisition rights
Long-term loans payable
Retirement benefit liability
Provision for directors’ retirement benefits
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

8

As of September 30, 2023

7,249
23,947
4,880
865
1,935
289
0
28,214
67,383

6,194
24,645
4,880
1,760
1,659
217
0
870
19,121
59,34918,58030,08275,743
1,029
255
4,653
130,345
197,728

16,14030,067
68,863
1,134
256
4,578
121,040
180,390

7,964
12,862
53,845-349
74,322

7,964
12,92058,081-326
78,640

160
648
-589
36
256
74,579272,308

421
808
-600
32
661
79,302259,692

(2) Quarterly Consolidated Income Statement and Quarterly Consolidated Statement of Comprehensive
Income(Quarterly Consolidated Income Statement)(Six Months Ended September 30, 2023)(Unit: million yen)
Six Months Ended
September 30, 2022
(From April 1, 2022
to September 30, 2022)

Six Months Ended
September 30, 2023
(From April 1, 2023
to September 30, 2023)

Net sales

83,093

98,662

Cost of sales

67,49475,082Gross income

15,59823,580

Selling, general and administrative expenses

11,653

15,183Operating income

3,945

8,396

Interest income

54

57

Dividend income

4674

Non-operating income

Foreign exchange gains

-

74

Other

229

94

Total non-operating income

330

300

Interest expenses

278

347

Expenses for measures for COVID-19

61

－

Other

154

137

Total non-operating expenses

494

484

3,780

8,212

Gain on sales of investment securities

18-

Total extraordinary income

18

-

-

768

204

117

Non-operating expenses

Ordinary income
Extraordinary income

Extraordinary losses
Loss on business withdrawal
Other
Total extraordinary losses

204

885

Net income before taxes

3,594

7,327

Income taxes

1,302

2,622

Net income

2,292

4,704

Net income attributable to owners of parent

2,292

4,704

9

(Quarterly Consolidated Statement of Comprehensive Income)(Six Months Ended September 30, 2023)(Unit: million yen)
Six Months Ended
September 30, 2022
(From April 1, 2022
to September 30, 2022)
Net income

Six Months Ended
September 30, 2023
(From April 1, 2023
to September 30, 2023)

2,292

4,704

Valuation difference on available-for-sale securities

-40

261

Deferred gains or losses on hedges

288

159

0

-11

Other comprehensive income

Foreign currency translation adjustment
Remeasurements of defined benefit plans-5-4

Total other comprehensive income

243

405

2,536

5,109

2,536

5,109

Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparent10

(3) Quarterly Consolidated Cash Flow Statement(Unit: million yen)
Six Months Ended
September 30, 2022
(From April 1, 2022
to September 30, 2022)
Cash flows from operating activities
Net income before taxes
Depreciation and amortization
Amortization of long-term prepaid expenses
Amortization of security deposits
Increase (decrease) in provision for bonuses
Interest and dividend income
Interest expenses
Expenses for measures for COVID-19
Loss on business withdrawal
Decrease (increase) in notes and account receivables trade
Decrease (increase) in accounts receivable - other
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payables trade
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Increase (decrease) in accrued consumption taxes
Increase (decrease) in guarantee deposits received
Other
SubtotalInterest and dividends received
Interest paid
Income taxes refund
Income taxes paid
Expenses for measures for COVID-19 paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments for acquisition of long-term prepaid
expenses
Payments of loans receivableCollection of loans receivable
Payments of lease and guarantee deposits
Proceeds from collection of lease and guarantee
deposits
Purchase of insurance funds
Proceeds from cancellation of insurance funds
Other
Net cash provided by (used in) investing activities

11

Six Months Ended
September 30, 2023
(From April 1, 2023
to September 30, 2023)

3,594
2,871
247
197
127
-101
278
61
-

7,327
3,221
241
188
-276
-131
347
－
768

-2,223-568

374-1,432

484
-667

687

-1,056

10-1,890-1,687
55
-664
507
64
-291
0
-1,190
-61
-971

313
-2,870
479
136
-128
7,806
92
-345
1,051
-681
7,924

-31
0
-3,3672-188

0-14,495
-293

-131

-273

-42
90
-841

-10
82
-1,431

165

55

-433
418
-171
-4,530

-274
280
-111
-16,471

(Unit: million yen)
Six Months Ended
September 30, 2022
(From April 1, 2022
to September 30, 2022)

Six Months Ended
September 30, 2023
(From April 1, 2023
to September 30, 2023)

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

-150

-

Repayments of long-term loans payable-1,760-6,181

Redemption of bonds-2,556-2,455

-3

-1

-388

-466

-8

48

-4,867-9,0570

16

Net increase (decrease) in cash and cash equivalents-10,370-17,587

Balance of cash and cash equivalents at the beginning ofcurrent period

37,56555,651

Balance of cash and cash equivalents at the end of current
period27,19538,063

Share buybacks
Cash dividends paid
Other
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents12(4) Notes on Quarterly Consolidated Financial Statements(Notes on the going concern assumption)
Not applicable(Notes concerning any notable changes in shareholders’ equity)
Not applicable(Application of special accounting procedures in the preparation of quarterly consolidated financial statements)(Calculation of tax expenses)
The Company calculates tax expenses by rationally assuming an effective tax rate after applying tax effect accounting to income(loss) before income taxes for the consolidated fiscal year, including the first six months of the fiscal year, and multiplying
income (loss) before income taxes for the first half of the fiscal year by the estimated effective tax rate. However, if the result of
calculation of tax expenses using the estimated effective tax rate is significantly unreasonable, the statutory effective tax rate isused.

(Changes in accounting policies)
Not applicable(Additional information)
Not applicable13

(Segment Information etc.)[Segment Information]
I For the six months ended September 30, 2022 (April 1, 2022 – September 30, 2022)
1. Information on net sales, income or loss by each reporting segment
Reporting segment

Dormitory

Hotel

Comprehensive
Building
Management

Other
Food
Service

Development

Total

Total

Note 1(Unit: million yen)Amountrecorded on
Adjustment consolidated
amountquarterly
Note 2incomestatement
Note 3

Net sales
Net sales to externalcustomers

24,741

46,428

3,716

573

179

75,6397,453

83,093–83,093

Inter-segmental sales
or transfers

169

61

4,337

3,780

405

8,754

331

9,086

-9,086－

Total

24,91046,490

8,053

4,353

585

84,393

7,785

92,179-9,086

83,093

2,239

2,756

193

134

30

5,354

51

5,405

-1,4603,945

Segment income(loss)

Notes: 1. The Other segment consists of the following businesses which are not included in the reporting segments: the SeniorLife Business (management and operation of senior residences), Public Kyoritsu Partnership (PKP) Business (services
provided under contract to local governments), support business for people who live alone, insurance agency business,
comprehensive human-resource services business, financial business, administrative outsourcing business, and otheradditional businesses.
2. Adjustment of segment income (loss) of -1,460 million yen includes the amount of elimination of inter-segment
transactions of 182 million yen and corporate expenses of -1,642 million yen that are not allocated to each reportablesegment. Corporate expenses mainly consist of expenses related to the Accounting Department and otheradministrative departments of the head office.
3. Segment income (loss) is adjusted with operating income on the quarterly consolidated statement of income.
2. Information on impairment loss on non-current assets or goodwill, etc. by reporting segment
Not applicable14II For the six months ended September 30, 2023 (April 1, 2023 – September 30, 2023)
1. Information on net sales, income or loss by each reporting segment
Reporting segment

Dormitory

Hotel

Comprehensive
Building
Management

Other
Food
Service

Development

Total

Note 1

Total(Unit: million yen)Amountrecorded on
Adjustment consolidated
amountquarterly
Note 2incomestatement
Note 3

Net sales
Net sales to externalcustomers

26,00860,471

3,478

792

246

90,997

7,665

98,662–

98,662

Inter-segmental sales
or transfers

174

105

6,741

4,425

371

11,819350

12,169-12,169–

Total

26,18360,576

10,2205,218

618

102,816

8,016

110,832-12,169

98,662

2,964

7,271

212

91

4

10,544-20

10,523-2,127

8,396

Segment income(loss)

Notes: 1. The Other segment consists of the following businesses which are not included in the reporting segments: the SeniorLife Business (management and operation of senior residences), Public Kyoritsu Partnership (PKP) Business (services
provided under contract to local governments), support business for people who live alone, insurance agency business,
comprehensive human-resource services business, financial business, administrative outsourcing business, and otheradditional businesses.
2. Adjustment of segment income (loss) of -2,127 million yen includes the amount of elimination of inter-segment
transactions of -97 million yen and corporate expenses of -2,029 million yen that are not allocated to each reportablesegment. Corporate expenses mainly consist of expenses related to the Accounting Department and otheradministrative departments of the head office.
3. Segment income (loss) is adjusted with operating income on the quarterly consolidated statement of income.
2. Information on impairment loss of non-current assets or goodwill, etc. by reporting segment
Not applicable15