Aug 10, 2016

Non-Consolidated Financial Results (Excerpt) for the Third Quarterof Fiscal 2016 [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:
Aug 10, 2016
Date to start distributing dividends:
Supplementary documents for this summary of financial statements
NoneResults briefing for financial results:
NoneThe original disclosure in Japanese was released on Jul 29, 2016 at 15:15 (GMT+9)
1. Non-Consolidated Financial Results for the Third Quarter of Fiscal 2016 (October 1, 2015 to June 30, 2016)(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
Millions ofFirst nine monthsof Fiscal 2016
First nine monthsof Fiscal 2015

Operating income

Yen%

Millions of

Ordinary income

Yen%

Millions ofNet income

Yen%

Millions ofYen%

2,021

19.3

979

32.6

981

30.5

649

36.61,694‫ڹ‬2.0738‫ڹ‬9.8752‫ڹ‬8.2475‫ڹ‬5.3

Fully diluted
net income per share

Net income per shareFirst nine monthsof Fiscal 2016
First nine monthsof Fiscal 2015

Yen

Yen

214.34213.22158.56157.26(2) Non-Consolidated Financial Position
Total assets

Net assets

Millions of

Jun 30, 2016
Sep 30, 2015
(Reference) Equity capital:

Yen

Equity ratio

Millions of

4,398
4,005
Jun 30, 2016: ¥3,768 million

Yen%

3,773
3,386
Sep 30, 2015: ¥3,379 million

85.7
84,4

2. Dividends
End ofFirst quarter

Fiscal 2015
Fiscal 2016Fiscal 2016 (forecast)

Dividend per share
End ofThird quarterEnd ofSecond quarter

Year-End

AnnualYen

Yen

YenYenYenʊʊ

46.00
49.00

ʊʊʊ

52.00

98.00

49.00

98.00

(Note) Revisions to recent dividends forecast: None
3. Non-Consolidated Forecast for the Year Ending September 30, 2016 (October 1, 2015 to September 30, 2016)
Net sales
Millions of

Fiscal 2016

Operating income

Yen%

2,368

3.9

Millions of

Ordinary income

Yen%

985

6.4

Millions of

Net income
per share

Net income

Yen%

987

5.1

Millions of

Yen%

653

11.1

Yen

215.54(Note) Revisions to recent business forecast: Yes
Net income per share has been calculated based on the average number of shares outstanding (3,033,097 shares) for the year ending September 30,2016, which was computed taking into account the number of shares issued as a result of the exercise of subscription rights to shares as a stock option
before or during the third quarter of the year ending September 30, 2016, and the number of treasury shares acquired in response to requests forpurchase of shares less than one unit.

(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(ϸ) :None(iii)Changes in accounting estimates:None(iv) Restatement:
None
(1)

Number of shares outstanding (common stock)(i) Number of shares outstanding(including treasury shares)

As of Jun 30, 2016

3,037,679

As of Sep 30, 2015

3,023,079(ii) Number of treasury shares

As of Jun 30, 201633

As of Sep 30, 2015

ʊ(iii)Average Number of shares outstanding

First nine monthsof Fiscal 2016

3,031,569

First nine monthsof Fiscal 2015

2,999,886* Implementation status of quarterly review proceduresThis financial results summary is not subject to quarterly review procedures under the Financial Instruments and Exchange Act, and thequarterly financial statement review procedures based on the Act were in progress at the time of the disclosure of these financial results.

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

2.

The forward-looking statements regarding financial results forecasts, etc., appearing in this financial results summary have been preparedbased on 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 variousfactors.
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.
.

Qualitative information regarding the quarterly settlement of accounts(1) Explanation of operating results
During the first nine months of the year ending September 30, 2016 (October 1, 2015, through June 30, 2016),
net sales of SHL-JAPAN Ltd. (the “Company”) increased ¥326 million, or 19.3%, year over year to ¥2,021 million.
By business segment, “Product sales” increased 25.7% to ¥1,135 million, “Consultancy sales” increased 11.0% to¥833 million and “Training sales” increased 31.0% to ¥52 million.
During the nine-month period under review, the Company has focused on conducting more aggressive marketing
activities, while the media reported the positive sentiment of corporations such as an increase for the fifth
consecutive year in the job offers-to-seekers ratio of new graduates who are expected to graduate in March 2017. Inaddition, as exemplified by the media reporting a significant increase in the early unofficial job offer rate for new
graduates on a year-over-year basis, as a result of the revision of the self-imposed regulations regarding theemployment of new graduates* that were introduced by industry groups, corporations accelerated the progress on
recruitment and screening of new graduates compared with the previous year, leading to the early provision of ourservices on a year-over-year basis. The Company believes that these circumstances contributed to year-over-year
growth in net sales of at least double digit in all business segments during the nine-month period under review.
Operating income for the nine-month period under review increased 32.6% year over year to ¥979 million.
Although the cost of goods sold increased ¥36 million, or 14.0% year over year, to ¥297 million, and selling,
general and administrative expenses increased ¥49 million, or 7.1% year over year, to ¥744 million, operating
income increased ¥240 million year over year due to the increase in revenue. The increase in the cost of goods soldprimarily was attributable to increases in subcontracting costs resulting from the increase of orders. The primaryfactors for the increase in selling, general and administrative expenses were increases in royalty, taxes and dues andsales promotion-related expenses in addition to increase in labor expenses largely due to an expansion of sales
personnel.
Ordinary income for the nine-month period under review increased 30.5% year over year to ¥981 million.
Ordinary income increased ¥229 million year over year, reflecting a small amount in non-operating expenses
similar to that for the same period a year earlier and the increase in operating income, although non-operating
income decreased ¥11 million year over year to ¥2 million. The primary factor for the decrease in non-operating
income was the reporting of ¥12 million as gains on investments in a limited liability partnership for the same
period of the previous fiscal year.
Income before income taxes for the nine-month period under review increased ¥229 million, or 30.5% year overyear, to ¥981 million, which was almost equal to ordinary income because both extraordinary gains andextraordinary losses were small.
Income taxes—current and income taxes—deferred increased ¥54 million, or 19.9% year over year, to ¥331
million, for which the estimated effective tax rate was 33.8% due to the change in the corporate tax rate (36.8% for
the corresponding nine-month period a year earlier). Net income for the nine-month period under review increased¥174 million, or 36.6% year over year, to ¥649 million due to the increase in income before income taxes.
* 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 graduatesprior 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 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 1 of the year of graduation or completion (it had been August 1 of the year ofgraduation or completion for new graduates who will enter corporations in fiscal 2016).
(2) Explanation about future prospects such as business forecasts
The operating results for the nine-month period under review, 2016 (October 1, 2015, through June 30, 2016)
showed considerable increases in both revenue and income compared with the same period a year earlier. Operating
income, ordinary income and net income for the nine-month period under review surpassed the forecasts for the full
fiscal year ending September 30, 2016. Meanwhile, the fourth quarter (July 1 through September 30, 2016) isprojected, at this time, to result in profit, although net sales and each income are projected to decrease significantly
compared with the same period a year earlier. In light of the operating results for the nine-month period underreview and the business forecast for the fourth quarter, the Company has revised its financial forecast for the full
fiscal year ending September 30, 2016.
The significant year-over-year decrease in net sales for the fourth quarter of the year ending September 30, 2016is due to the fact that corporations accelerated the progress on recruitment and screening of new graduates who areexpected to graduate in March 2017 compared with the previous year, leading to the early provision of our services
on a year-over-year basis. Therefore, net sales forecast for the full fiscal year ending September 30, 2016 remains
unchanged from the forecast released on October 29, 2015, and has not been revised.