Feb 12, 2019

Non-Consolidated Financial Results (Excerpt) for the First Quarterof Fiscal 2019 [J-GAAP basis]
Listed Company Name:SHL-JAPAN Ltd.
Registered on Tokyo Stock Exchange
Securities Code:4327
URL:http://www.shl.co.jp/
Representative:
Manabu Nara, Managing Director
Contact:
Naohiro Nakamura, Executive Director        Tel: +81-3-5385-8781
Date to submit the Quarterly Securities Report:
Feb 14, 2019
Date to start distributing dividends:
㸫Supplementary documents for this summary of financial statements:
NoneResults briefing for financial results:
NoneThe original disclosure in Japanese was released on Jan 30, 2019 at 15:15 (GMT+9)
1. Non-Consolidated Financial Results for the First Quarter of Fiscal 2019 (October 1, 2018 to Dec 31, 2018)(1) Non-consolidated Business Results(The percentages indicate the rate of increase or decrease compared with the same period of the previous fiscal year.)Net sales

Operating income

Millions of Yen%

Millions of Yen

Ordinary income%Millions of Yen

Net income%Millions of Yen%First three monthsof Fiscal 2019345

15.612㸫

13㸫9㸫

First three monthsof Fiscal 2018299

7.2‫ڹ‬22㸫‫ڹ‬22㸫

‫ڹ‬15

㸫

Fully diluted net incomeper share

Net income per shareFirst three monthsof Fiscal 2019

YenYen1.53

1.52First three months‫ڹ‬2.62
㸫of Fiscal 2018
(Note) Fully diluted net income per share for the first quarter of the year ended September 30, 2018 is not presented despite the existence of diluted
shares because a net loss per share was posted.

(2) Non-consolidated Financial Position
Total assets

Net assets

Millions ofYen

Equity ratio

Millions ofDec 31, 2018
4,531
Sep 30, 2018
4,928
(Reference) Equity capital: Dec 31, 2018: ¥4,088 million

Yen%

4,091
4,280
Sep 30, 2018: ¥4.277 million

90.2
86.8

2. Dividends

Fiscal 2018
Fiscal 2019
Fiscal 2019 (forecast)

Dividend per share
Q3 EndYear-End

Q1 EndQ2 End

Yen

Yen

Yen

Yen

AnnualYen

㸫
㸫

32.00

㸫35.00

67.00

34.00

㸫

34.00

68.00

(Note) Revisions to recent dividends forecast: None
3. Non-Consolidated Forecast for the Year Ending September 30, 2019 (October 1, 2018 to September 30, 2019)
Net sales
Millions of

Fiscal 2019

Operating income

Yen%

2,825

4.5

Millions ofOrdinary income

Yen%

1,166

0.5Millions ofNet incomeper share

Net income

Yen%

1,1640.4

Millions ofYen%

Yen7980.4

134.10(Note) Revisions to recent business forecast: NoneNet income per share has been adjusted based on the average number of shares outstanding (5,954,144 shares) for the year ending September 30, 2019,
which was calculated taking into account the number of shares issued during the first quarter of the year ending September 30, 2019 through theexercise of share subscription rights as a stock option, and the number of treasury shares held.

1*Note(1) Application of particular accounts procedures to the preparation of quarterly non-consolidated financial statements: Yes(2) Changes in accounting policies and changes or restatement of accounting estimates(i) Changes in accounting policies caused by revision of accounting standards:
None(ii) Changes in accounting policies other than( ):None(iii) Changes in accounting estimates:None(iv) Restatement:
None(3) Number of shares outstanding (common stock)(i) Number of shares outstanding(including treasury shares)

As of Dec 31, 2018

6,105,958

As of Sep 30, 2018

6,100,358(ii) Number of treasury shares

As of Dec 31, 2018

150,893

As of Sep 30, 2018

150,844(iii) Average Number of shares outstanding

First three monthsof Fiscal 2019

5,951,409

First three monthsof Fiscal 2018

5,946,210* Implementation status of quarterly review proceduresThis financial results summary is not subject to quarterly review procedures.

* Explanations and other special notes concerning the appropriate use of financial results forecasts
1.
2.

The forward-looking statements regarding financial results forecasts, etc., appearing in this financial results summary have been prepared basedon information currently available to the Company and certain assumptions that the Company believes to be reasonable. The Company makes
no guarantee as to their realization. Actual financial results may differ substantially from the forecasts due to various factors.
As the Company’s services are often used for the screening of new graduates to be employed by corporate customers, our sales inevitably
involve seasonal fluctuations. Accordingly, the Company’s performance management is conducted on an annual basis.

2

Qualitative information regarding the quarterly settlement of accounts(1) Explanation of operating results
During the first three months of the year ending September 30, 2019 (October 1, 2018, through December 31,2018), net sales of SHL-JAPAN Ltd. (the “Company”) increased ¥46 million, or 15.6%, year over year to ¥345
million. By business segment, “Product sales” increased 22.9% to ¥223 million, “Consultancy sales” increased
6.7% to ¥114 million and “Training sales” decreased 19.9% to ¥8 million.
“Product sales” increased ¥41 million compared with the same period of the previous fiscal year. This wasprimarily attributable to the favorable sales of “GAB”, Web test of general abilities. Moreover, “Consultancy sales”
increased ¥7 million compared with the same period of the previous fiscal year. This was primarily due to thefavorable sales of customized versions of the “Web Test”. “Training sales” decreased ¥2 million compared with thesame period of the previous fiscal year, primarily due to the decrease in orders received for open courses.
Operating income for the three-month period under review totaled ¥12 million (compared with operating loss of¥22 million for the same period of the previous fiscal year). While the cost of goods sold decreased ¥1 million, or2.3%, year over year to ¥65 million, selling, general and administrative expenses increased ¥12 million, or 5.0%
year over year, to ¥266 million, but operating income increased due to the increase in net sales. The primary factors
for the increase in selling, general and administrative expenses were increases in royalty and recruiting expenses.
Ordinary income for the three-month period under review totaled ¥13 million (compared with ordinary loss of¥22 million for the same period of the previous fiscal year). This figure was almost equal to operating income
because both non-operating income and non-operating expenses were small as in the same period of the previousfiscal year.
Income before income taxes for the three-month period under review was equal to ordinary income because noextraordinary gains or extraordinary losses were recorded, and totaled ¥13 million (compared with loss before
income taxes of ¥22 million for the same period of the previous fiscal year).
After taking into account the above factors and income taxes—current and income taxes—deferred, net income
secured for the three-month period under review totaled ¥9 million (compared with net loss of ¥15 million for thesame period of the previous fiscal year).
<Reference 1: Sales by business segment>
ProductConsultancy
Training
Total

First three months of Fiscal 2018
Millions of Yen
Component ratio
181
60.7
107
35.8
103.5
299
100.0

<Reference 2: Sales by quarterly basis>
First Quarter
Millions ofYen

First three months of Fiscal 2019
Millions of Yen
Component ratio
223
64.6
114
33.0
8
2.4
345
100.0

Second Quarter

Third Quarter

Year-EndMillions ofMillions ofMillions ofYen

Yen nRate of increase(decrease)
22.9
6.7‫ڹ‬19.9
15.6

AnnualYen

Millions ofYen

Fiscal 2017
278
896
1,030
369
2,575
Fiscal 2018
299987
986
431
2,704
Fiscal 2019345
㸫㸫㸫㸫
*Note: As the Company’s services are often used for the screening of new graduates to be employed by corporate customers, oursales inevitably involve seasonal fluctuations. Moreover, the rate of fluctuation may at times increase due to changes in therecruiting and screening periods and other reasons. In recent years, sales have tended to concentrate in the second and thirdquarters of the fiscal year.

3(2) Explanation about future prospects such as business forecasts
In the year under review, the Company believes that the screening market environment for new graduates
expected to graduate in 2020 will continue to grow steadily as in the previous fiscal year, because the industry'sself-imposed controls on employment PR activity and screening process for new graduates*, which are currently inforce, are in their final year of implementation, and corporations remain highly motivated to hire more employees
against a backdrop of a chronic labor shortage.
However, we intend to continue enhancing our operating performance by speedily providing optimum services
based on our precise analysis and understanding of corporate customers’ needs.
In light of the above, and based on our analysis and study of the business results, financial position and otherbusiness management materials for the three-month period under review, no changes have been made to thebusiness forecast for the year ending September 30, 2019, which was released on October 30, 2018.
* The industry has self-imposed controls regarding the employment of new graduates, under which industry
groups agreed not to start employment PR activity and the screening process for new graduates prior to a fixed
date in light of the academic schedules for students. The Keidanren (Japan Business Federation) stipulated in
its “Guidelines for Recruiting and Employing New Graduates” that corporations’ PR activity for new
graduates who will enter corporations in fiscal 2017 onwards shall commence on and after March 1 of the year
just preceding the year of graduation or post-graduate completion, and screening activity on and after June 1of the year of graduation or completion.

4