Kyoritsu Maintenance Co., Ltd.
(Securities Code: 9616)

First Half of Fiscal Year Ending March 2017
Consolidated Earnings Results Update
November 20161

First Half of Fiscal Year Ending March 2017 Consolidated Earnings Announcement
November 9, 2016

Company Name: Kyoritsu Maintenance Co., Ltd.
Tokyo Stock Exchange
Stock Code: 9616, URL: http://www.kyoritsugroup.co.jp/
Director: Mitsutaka Sato, President
Contact: Takumi Ueda, Vice President; Tel: +81-3-5295-7778
Quarterly Earnings Announcement Report Filing Date (Anticipated): November 14, 2016
Dividend Payment Date (Anticipated): December 5, 2016
Quarterly Earnings Presentation Document (Anticipated): Yes
Quarterly Earnings Presentation Meeting (Anticipated): Yes (For Institutional Investors)(All figures of less than one million yen are rounded down to the nearest digit)
1. First Half of Fiscal Year Ending March 2017 Consolidated Earnings (April 1, 2016 to September 30, 2016)(1) Consolidated Earnings (Aggregated)(% figures show year-on-year change)
Net Sales

Operating Income

Profit Attributable to Ownersof Parent

Ordinary Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

68,477

2.4

7,173

16.6

6,861

19.0

4,268

12.3

66,867
24.8
6,153
36.1
5,764
36.6
3,800
1H FY3/16(Note) Comprehensive income: ¥3,957 million (23.5% YoY) in 1H FY3/17; ¥3,204 million (2.4% YoY) in 1H FY3/16

39.4

1H FY3/17

EPS

Fully Diluted EPS
Yen

Yen

1H FY3/17

220.63201.781H FY3/16

203.76194.82(2) Consolidated Financial Position
Total Assets

Net Assets

Equity Ratio

Book Value Per Share

Millions of yen

Millions of yen%

Yen

157,397

61,43939.0

3,174.81

FY3/16
161,40257,974(Note) Capital: ¥61,439 million in 1H FY3/17; ¥57,974 million in FY3/16

35.9

2,997.10

1H FY3/17

2. Dividend Conditions
Dividend Per Share
1Q-End2Q-EndYen

3Q-EndFY3/16

―

Yen
25.00

FY3/17―26.00

FY3/17 (Projected)(Note) Recent changes in dividend projections: None

4Q-End
Yen

Total

―

Yen
27.00

Yen
52.00

―

26.00

52.00

3. Fiscal Year Ending March 2017 Consolidated Earnings Estimates (April 1, 2016 to March 31, 2017)(% figures show year-on-year change for the full year)
Net Sales

Operating Income

Profit Attributable to
Owners of Parent

EPS

Millions of yen% (YoY)

Millions of yen% (YoY)

Millions of yen% (YoY)

Yen

Full Year138,000
2.2
11,500(Note) Recent changes in earnings estimates: None

12.3

11,000

12.5

6,900

15.6

356.71Millions of yen% (YoY)

Ordinary Income2Notes(1) Important changes in our subsidiaries, including changes to the scope of our consolidation: None
(2) Application of special accounting procedures in the preparation of our quarterly consolidated financial statements: Applicable(Note) Please refer to “2. Summary Information (Notes), (2) Application of special accounting procedures in the preparation of ourquarterly consolidated financial statements” on page 7 for more details.
(3) Changes in the accounting policies, procedures, and changes or revisions in the display of accounting estimates:
1. Changes accompanying revisions in accounting standards:
Applicable
2. Other changes:
None
3. Changes in accounting estimates:
None
4. Redisplay of revisions:
None(Note) Please refer to “2. Summary Information (Notes), (3) Changes in the accounting policies, procedures, and changes orrevisions in the display of accounting estimates” on page 7 for more details.

(4) Shares Issued (Common Stocks)
1. Shares issued as of term-end (including treasury shares)

1H FY3/17
1H FY3/17
1H FY3/17

2. Treasury stock as of term-end
3. Average during the term (first six months)

19,461,727
109,607
19,348,035

FY3/16
FY3/16
1H FY3/16

19,452,173
108,573
18,652,572* Information Regarding Quarterly Review Practices:
The practices for review of quarterly consolidated earnings statements pursuant to the “Financial Instruments and Exchange Act” ofJapan have not been conducted for the disclosure of this document.
* Notes and explanations regarding the appropriate use of our earnings projections:(Notes on forecast results)
All earnings estimates and forward-looking statements in this document are based on the best information available and rational
decisions of management at the time of its creation, and actual earnings may diverge largely from those estimates and forward-looking
statements put forward in this document due to various unforeseen factors. Moreover, for information regarding earnings estimates
and the assumptions upon which they are based, and the usages of these earnings estimates, please refer to the section, “1. Qualitative
Information about Quarterly Earnings, (3) Explanation of future forecasts including consolidated earnings estimates” on page 6.

(Access to quarterly earnings presentation documents)
Quarterly earnings presentation materials are available on the Kyoritsu Maintenance website.

3

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement
Index
1. Qualitative Information about Quarterly Earnings

5(1) Explanation of business performance5(2) Explanation of financial position

6(3) Explanation of future forecasts including consolidated earnings estimates6

2. Summary Information (Notes)

7(1) Changes in important consolidated subsidiaries during the quarter

7(2) Application of special accounting procedures in the preparation of7

our quarterly consolidated financial statements(3) Changes in the accounting policies, procedures, and changes or revisions

7

in the display of accounting estimates(4) Additional information

7

3. Quarterly Consolidated Financial Statements

8(1) Quarterly consolidated balance sheet

8(2) Quarterly consolidated income statement and comprehensive income statement

10

Quarterly consolidated income statement
Consolidated first half

10

Quarterly consolidated comprehensive income statements
Consolidated first half11(3) Consolidated cash flow statement12(4) Quarterly consolidated financial statement notes

14(Notes regarding going concern assumptions)

14(Significant changes in shareholders’ equity notes)

14(Segment information)

14

4

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement
1. Qualitative Information about Quarterly Earnings(1) Explanation of business performance
During the first half of the current fiscal year, although a modest recovery trend continued in the Japanese economy as
there were signs of improvements in the employment and income environment, prevailing uncertainties were seen as
personal consumption remained sluggish, there was growing uncertainty in economies overseas, and there werefluctuations in the financial markets.
Against this backdrop, our dormitory business got off to a solid start with occupancy rates rising by 1.0 percentage point
year on year to 98.3% at the start of the fiscal year, partially due to growing needs with respect to company dormitories. In
the hotel business segment, occupancy rates and Average Daily Rate were high, benefiting from strong domestic demand
as well as ongoing year-on-year growth in inbound demand even though market competition has intensified.
As a result, during the first half of the current fiscal year, both revenues and earnings increased to exceed the initial
earnings estimates, with sales up 2.4% year on year to ¥68,477 million, operating income up 16.6% to ¥7,173 million,
ordinary income up 19.0% to ¥6,861 million, and profit attributable to owners of parent up 12.3% to ¥4,268 million.
Note that while profit growth was gradual compared to the first quarter of the current fiscal year, this was due to factors
including the impact of the typhoon, repair costs in the dormitory business, and business commencement expenses for
Dormy Inn business hotels.
We provide details of our earnings by business segment as follows.
Dormitory businessOur dormitory business got off to a solid start with the occupancy rate at the beginning of the fiscal term having gained by
1.0 percentage point year on year to 98.3%, and the total number of contracted residents rising by 1,021 year on year to33,708 residents as of the end of September. In addition, student dormitories trended favorably during the first half of thecurrent fiscal year partially due to increasing numbers of students from overseas, while corporate dormitories achieved
substantial gains in numbers of contracts due to factors that included companies hiring greater numbers of new company
employees and more companies now opting to offer employee dormitories. The impact of the Kumamoto Earthquake in
April was minimal.
As a result, sales rose by 3.2% year on year to ¥22,555 million, and operating income increased significantly by 19.4%
year on year to ¥3,546 million, due to ongoing implementation of stringent cost controls on a facility-by-facility basis.
Hotel businessWith respect to the Dormy Inn business hotels, this fiscal year we have opened four establishments, which have been wellreceived— the “Natural Springs Tento no Yu Dormy Inn Abashiri”, “global cabin Gotanda”, “Natural Springs Toyama
Tsurugi no Yu Onyado Nono”, and “Natural Springs Zenkou No Yu Dormy Inn Nagano”. Our existing hotels maintained
high occupancy rates and Average Daily Rates that were up year on year due to solid demand from repeat customers inJapan and the ongoing increase in inbound demand, and it was possible to cover concentrated development costs as aresult.
Note that while operations were suspended at “Natural Springs Rokka no Yu Dormy Inn Kumamoto” as a result of the
Kumamoto Earthquake in April, operations were resumed in August.
In the resort hotel business, the occupancy rate was high, exceeding overall levels in the previous year, thanks in part to therecovery in the occupancy rate at hotels in the Hakone region to levels on par with typical years, and Average Daily Rate
also rose. In addition, cost management was thorough due to flexible personnel assignments tailored to individual
occupancy conditions.
As a result, sales rose 12.6% year on year to ¥30,074 million and operating income climbed significantly by 14.9% to¥4,624 million, managing to also absorb the impact of the typhoon.
Contracted services businessIn the contracted services business, both revenues and earnings decreased due to factors including a postponement ofconstruction work. As a result, sales decreased 8.3% year on year to ¥6,467 million and operating income decreased by
19.3% year on year to ¥151 million.
Food service business
While the food service business generates higher sales due to an increase in the number of contracted hotel restaurants, due
to factors including a struggling spa business, sales grew 17.3% year on year to ¥3,163 million, and an operating loss of¥26 million was recorded in comparison with an operating loss of ¥17 million in the same quarter of the previous fiscal
year.

5

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement
Construction business
The construction business generated increases in revenue and earnings as a result of bringing in greater numbers of orders
for hotel development. Consequently, sales and operating income rose by 39.2% and 185.7% year on year to ¥9,864
million and ¥537 million, respectively.
Other business
Our other business segments are the Senior Life (former Wellness Life) business (management of senior citizen housing),
the Public Kyoritsu Partnership business (PKP: consigned services business provided to regional government bodies),
single life support business and insurance agency business, comprehensive human resource services business, andfinancing and administrative outsourcing services. The other business segments posted total net sales of ¥5,660 million, adecrease of 3.9% year on year, and incurred an operating loss of ¥108 million, in comparison with an operating loss of ¥21
million in the same period of the previous fiscal year.
(2) Explanation of financial position
1. Conditions of assets, liabilities, and net assets(Assets)
Total consolidated assets declined by ¥4,005 million from the end of the previous fiscal year to ¥157,397 million at the endof the second quarter. The main factor behind this decrease was a decrease in cash and deposits, etc.
(Liabilities)
Total consolidated liabilities declined by ¥7,469 million from the end of the previous fiscal year to ¥95,958 million at the endof the second quarter, due primarily to declines in advances received and notes and accounts payable–trade.
(Net assets)
Net assets grew by ¥3,464 million from the end of the previous fiscal year to ¥61,439 million at the end of the second quarter,due mainly to a rise in retained earnings.
Consequently, equity ratio rose by 3.1 p.p. from the end of the previous fiscal year to 39.0% at the end of the second quarter.
2. Cash flow conditions
Cash and equivalents declined by ¥11,545 million from the end of the previous fiscal year to ¥14,057 million at the end of
the second quarter.
(Cash flow from operating activities)
Net cash provided by operating activities amounted to ¥3,368 million in the current first half, an increase of ¥4,831 million
compared with the same period of the previous fiscal year due to a decrease in notes and accounts receivable–trade and adecrease in other inventories.

(Cash flow from investing activities)
Net cash used by investing activities amounted to ¥14,024 million in the current first half, an increase of ¥9,279 million
compared with the same period of the previous fiscal year due to purchases of property, plant and equipment and payments
for lease and guarantee deposits.

(Cash flow from financing activities)
Net cash provided by financing activities amounted to ¥780 million in the current first half, an increase of 5,021 million
compared with the same period of the previous fiscal year due to proceeds from long-term loans payable.
(3) Explanation of future forecasts including consolidated earnings estimates
Our consolidated earnings estimates for the full fiscal year ending March 31, 2017, as provided in the “Fiscal Year Ending
March 2017 Consolidated Earnings Announcement” dated May 13, 2016, remain unchanged at this point in time.

6

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement
2. Summary Information (Notes)(1) Changes in important consolidated subsidiaries during the quarter
Not applicable(2) Application of special accounting procedures in the preparation of our quarterly consolidated financial statements(Calculation of tax expense)
The Company applies the method that reasonably estimates an effective tax rate to be assessed on income before income
taxes for the year ending March 31, 2017, including this six months ended September 30, 2016, after accounting for the tax
effects, and multiplies income before income taxes during the six months ended September 30, 2016 by this estimatedeffective tax rate. However, in the event that the estimate for the effective tax rate appears to lack logical rationale, then thelegally determined effective tax rate is employed.
(3) Changes in the accounting policies, procedures, and changes or revisions in the display of accounting estimates
Changes in accounting policies(Application of Practical Solution on a Change in Depreciation Method due to Fiscal 2016 Tax Reforms)
Due to revisions in the Corporation Tax Act, the Company has adopted the “Practical Solution on a Change in Depreciation
Method due to Fiscal 2016 Tax Reforms” (ASBJ Practical Issue Task Force No. 32, issued on June 17, 2016) from the firstquarter of the current fiscal year, and changed the method for the depreciation of some facilities attached to buildings andstructures acquired on or after April 1, 2016 from the declining-balance method to the straight-line method.
The effect of this change on the Company’s operating income, ordinary income and income before income taxes for thesecond quarter is insignificant.
(4) Additional information(Application of Implementation Guidance on Recoverability of Deferred Tax Assets)
The Company has adopted the “Implementation Guidance on Recoverability of Deferred Tax Assets” (ASBJ Guidance No.
26, March 28, 2016) from the first quarter of the current fiscal year.

7

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement
3. Quarterly Consolidated Financial Statements(1) Quarterly consolidated balance sheet
FY3/16(March 31, 2016)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable–trade
Real estate for sale in process
Costs on uncompleted construction contracts
Other
Allowance for loan losses
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 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

8(Unit: Millions of yen)
1H FY3/17(September 30, 2016)

25,960
9,763
2,827
331
6,368
(19)
45,231

14,415
7,053
1,688
417
6,608
(27)
30,15536,33733,807
6,906
2,190
79,2401,710

36,37036,455
11,7082,332
86,8672,533

5,034
12,19910,103
7,978(212)
35,103116,054
116
161,402

4,893
13,654
10,901
8,503(215)
37,736
127,137
104
157,397

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement(Unit: Millions of yen)
1H FY3/17(September 30, 2016)

FY3/16(March 31, 2016)
Liabilities
Current liabilities
Notes and accounts payable–trade
Short-term loans payable
Current portion of bonds
Income taxes payable
Advances received
Provision for bonuses
Provision for directors’ bonuses
Provision for warranties for completed construction
Provision for point card certificates
Provision for loss on disaster
Other
Total current liabilities
Non-current liabilities
Bonds payable
Convertible bond-type bonds with subscription
rights to shares
Long-term loans payable
Director retirement benefit reserve
Provision for point card certificates
Net defined benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

9

6,966
21,471
1,350
2,765
11,079
1,700
426
8
18
–
7,861
53,6484,374
26,086
1,350
2,487
8,073
982
191
8
17
87
7,240
50,900

5,600

4,925

20,60820,571

17,940
287
25
1,072
4,244
49,779103,428

13,777
286
35
1,113
4,348
45,057
95,958

7,654
12,50937,778(305)
57,637

7,673
12,52841,524(313)
61,413

736
(393)
(5)
336
57,974
161,402

709
(684)
0
26
61,439157,397

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement(2) Quarterly consolidated income statement and comprehensive income statement(Quarterly consolidated income statement)(Consolidated first half)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Deposit redemption income
Other
Total non-operating income
Non-operating expense
Interest payment
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on cancellation of leasehold contracts
Total extraordinary income
Extraordinary losses
Impairment loss
Loss on disaster
Settlement funds
Other
Total extraordinary losses
Income before income taxes
Income taxes

1H FY3/16(April 1, 2015 to
September 30, 2015)
66,86752,502
14,364
8,211
6,153(Unit: Millions of yen)
1H FY3/17(April 1, 2016 to
September 30, 2016)
68,47752,305
16,172
8,998
7,173

68
25
35
59
188

35
27
39
55
158

404
171
576
5,764

313
156
470
6,861

432
432

–
–

–
–
175
39
214
5,982
2,181
3,800
3,800

89
304
–
27
421
6,440
2,171
4,268
4,268

ProfitProfit attributable to owners of parent

10

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement(Quarterly consolidated comprehensive income statements)(Consolidated first half)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income(Details)
Comprehensive income attributable to owners of parent

11

1H FY3/16(April 1, 2015 to
September 30, 2015)
3,800(Unit: Millions of yen)
1H FY3/17(April 1, 2016 to
September 30, 2016)
4,268

(157)
(426)
(11)
(595)
3,204

(27)
(290)
6
(310)
3,957

3,204

3,957

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement(3) Consolidated cash flow statement(Unit: Millions of yen)Previous Term FY3/16(April 1, 2015 to
September 30, 2015)
Cash flow from operating activities
Income before income taxes and minority
interests
Depreciation

Current Term FY3/17(April 1, 2016 to
September 30, 2016)

5,982

6,440

1,678

1,849

Amortization of long-term prepaid expenses

195

202

Amortization of guarantee deposits

100

107

Increase (decrease) in provision for bonuses

(333)

(717)

Interest and dividend income

(93)

(63)

Interest expenses

404

313

Gain on cancellation of leasehold contracts

(432)

–

Impairment loss–

89

Loss on disaster
Settlement funds

–

304

175

–

(599)

2,709

525

357

(1,606)

1,005

(325)

(2,591)

Decrease (increase) in notes and accounts
receivable - trade
Decrease (increase) in accounts receivable other
Decrease (increase) in other inventories
Increase (decrease) in notes and accounts
payable - trade
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Increase (decrease) in accounts payable - other
Increase (decrease) in accrued consumption
taxes
Increase (decrease) in deposits received

32

(111)

(3,943)(3,005)

(230)

(117)

(629)

320

(519)

(604)

Increase (decrease) in guarantee deposits
received
Other

159

25

(116)

(212)

Subtotal

422

6,302

Interest and dividend income received

69

35Interest expenses paid

(408)

(313)

Income taxes refund

1

1(1,546)(2,657)(1,462)

3,368

(2)

(11)

Income taxes (paid) refund
Net cash provided by (used in) operating
activities
Cash flows from investing activities
Purchase of securities
Proceeds from sales of securities

1,061

92

Purchase of property, plant and equipment(4,646)(10,650)

Proceeds from sales of property, plant andequipment
Purchase of intangible assets

329

112

(50)

(897)

Payments of loans receivable

(401)

(344)

Collection of loans receivable

390

404

Payments for lease and guarantee deposits(726)(2,512)

Proceeds from collection of lease and guarantee
deposits
Purchase of insurance funds

90

52

(556)

(540)

Proceeds from cancellation of insurance funds

21

175

(253)

96

(4,745)(14,024)

Other
Net cash provided by (used in) investing
activities

12

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement(Unit: Millions of yen)Previous Term FY3/16(April 1, 2015 to
September 30, 2015)

Current Term FY3/17(April 1, 2016 to
September 30, 2016)

Cash flow from financing activities
Net increase (decrease) in short-term loans
payableProceeds from long-term loans payable

8,200

7,350

1,800

–

Repayments of long-term loans payable(4,580)(6,898)

(675)

(675)

Redemption of bonds
Purchase of treasury shares

(91)

(8)

Cash dividends paid

(384)

(521)

Other

(29)

(27)

4,240

(780)

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

(102)

(108)

(2,070)(11,545)

Cash and cash equivalents at beginning of period

15,75825,603

Cash and cash equivalents at end of period

13,68814,05713

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement(3) Quarterly consolidated financial statement notes(Notes regarding going concern assumptions)Not applicable(Significant changes in shareholders’ equity notes)
Not applicable(Segment information)
Segment information
I. First half of fiscal year ended March 2016 (From April 1 to September 30, 2015)
1. Information pertaining to segment sales, profits and losses(Unit: Millions of yen)
Reporting segments
Other(Note 1)

Total

Adjustments(Note 2)

Consolidated(Note 3)

Dormitories

HotelsContracted
Services

21,75326,656

3,597

795

8,396

61,1995,668

66,867–

66,867

113

46

3,458

1,902

(1,308)

4,211

222

4,433

(4,433)–

Total

21,866

26,703

7,055

2,698

7,087

65,4105,890

71,301(4,433)

66,867

Segment profit/loss

2,971

4,025

187

(17)

188

7,354

(21)

7,333

(1,179)

6,153

Food
Services

Construction

Subtotal

Sales
External sales
Inter-segment sales
and transfers(Notes) 1. Other is not considered as a reporting business segment and is comprised of the wellness life (management of seniorcitizen housing), PKP business (consigned services business provided to regional government bodies), single life support
services, insurance agency business, comprehensive human resources, financing and advertising agency services.
2. Adjustment for segment profit and loss of ¥1,179 million includes ¥29 million for inter-segment transaction eliminations,and ¥1,150 million in companywide expenses that cannot be allocated to specific reporting segments. Companywide
expenses are primarily those expenses arising from the finance and accounting, and management divisions.
3. Segment profits or losses are derived by adjusting the operating income used in the quarterly consolidated income
statement.

2. Impairment accounting losses and goodwill amortization of fixed assets by reporting segments
None

14

Kyoritsu Maintenance (9616), 1H FYE March 2017 Earnings Announcement
II. First half of fiscal year ending March 2017 (From April 1 to September 30, 2016)
1. Information pertaining to segment sales, profits and losses(Unit: Millions of yen)
Reporting segments
Other(Note 1)

Total

Adjustments(Note 2)

Consolidated(Note 3)

Dormitories

HotelsContracted
Services

External sales

22,441

30,009

3,523

846

6,229

63,0505,426

68,477–

68,477

Inter-segment
sales andtransfers

114

65

2,943

2,317

3,634

9,075

233

9,308

(9,308)–

Total

22,55530,074

6,467

3,163

9,864

72,125

5,660

77,786(9,308)68,477

Segment
profit/loss

3,546

4,624

151

(26)

537

8,832

(108)

8,723

(1,549)

7,173

Food
Services

Construction

Subtotal

Sales(Notes) 1. Other is not considered as a reporting business segment and is comprised of the Senior Life (former Wellness Life)(management of senior citizen housing), PKP business (consigned services business provided to regional government
bodies), single life support services, insurance agency business, comprehensive human resources, financing services andother related services.
2. Adjustment for segment profit and loss of ¥1,549 million includes ¥349 million for inter-segment transaction
eliminations, and ¥1,200 million in companywide expenses that cannot be allocated to specific reporting segments.
Companywide expenses are primarily those expenses arising from the accounting and management divisions.
3. Segment profits or losses are derived by adjusting the operating income used in the quarterly consolidated income
statements.

2. Impairment accounting losses and goodwill amortization of fixed assets by reporting segmentsNone15