Results for the three months ended

August 7th, 2020

CO., LTD.
June 30, 2020【 Reference 】 Code; NAC
9788 TSE 1st section

Translation

In the case of inconsistencies between the Japaneseand English version, the Japanese version will control
and supersede any ambiguities.

Topics
1. Results for the three months
ended June 30, 2020 …
2. Results by Segments

P. 2

…

P. 9

3. FY2020 Forecasts of Financial Results …

P. 20

4. Plan of Dividends

…

P. 23

5. Appendix

…

P. 25

This document contains certain forward-looking statements including the NAC Group’s
sales and contract targets based on information available to the Group as of the date ofrelease. These statements are subject to a number of risks and uncertainties such as
economic and business conditions as well as the outcomes of new services.
Therefore, please understand that actual future results may differ materially from theseprojections set forth in the Group’s forward-looking statements.
11. Results for the three months ended
June 30, 20202

１

Consolidated Income Statement
3 months
ended FY2020

3 months
ended FY2019（Millions of yen）

YOY
Comparison

12,727

17,800▲ 28.5 ％Gross profit

6,430

7,174

▲ 10.4 ％（Gross margin）

50.5 %

40.3 %+ 10.2 pt

6,218

8,417

▲ 26.1 ％Operating Income

211▲ 1,243-（Operating margin）

1.7 ％▲ 7.0 ％

+ 8.6 pt

Non-operating
income and loss

▲ 77

▲ 22

-

Ordinary Income134▲ 1,265-

Extra-ordinary
income and loss

431

▲4

-

Net Income attributableto owners of parent532▲ 1,355

-

Sales

SG&A

≫ Consolidated sales decreased year on year. This is because Leohouse was excluded from our consolidated subsidiaries from the
1st quarter of this fiscal year.
≫ Operating income increased year on year, due to the exclusion of loss for Leohouse, which was recorded in the same period of
the previous year, and significant growth in the CreCla Business.
≫ Extraordinary income was recorded as a special profit from the sale of Leohouse shares.
≫ Net income attributable for owners of parent increased due to an upturn in operating income and extra-ordinary income.
3

１

Sales & Operating income trend by Quarter
Sales（Millions of yen）

Operating Income（Millions of yen）

35,0005,000
29,70230,00025,00020,00015,00022,253

21,584

15,581▲ 5,000

1,820
1,013

828

2,000
12,727527
211▲ 1,243

292

5,000

3,000

20,59917,80010,000023,889

2,705

4,000

25,9320-1,000▲ 1,497
Q1

1,000

Q2

Q3

FY2018

Q4

Q1

Q2

Q3
FY2019Q4Q1-2,000

FY2020≫ The Nac Group of companies tended to post an operating loss in the 1st quarter because hand-over in the Housing
Sales Business usually concentrate around the 4th quarter.
However, we posted operating income in the 1st quarter, because Leohouse was excluded from our consolidated
subsidiaries from the 1st quarter of this fiscal year..

4

１

Sales by Segment
3 months
ended FY2020

3 months
ended FY2019（Millions of yen）

YOY
Comparison

CreCla

3,844

3,103

23.9 ％

Rental

3,508

3,509

0.0 ％

Construction
Consulting

1,949

1,216

60.3 ％

Housing Sales

1,670

7,408

▲ 77.5 ％Beauty and Health

1,763

2,593

▲ 32.0 ％Elimination

▲9

▲ 30

-

12,727

17,800▲ 28.5 ％Total≫ In the CreCla Business, sales increased year on year due to the bottle price hike and increase customer unit price in our
direct managed stores, increase in server sales in our affiliated stores, increased sales of ZiACO utilizing “hypochlorous acidwater”.
≫ In the Rental Business, sales remained on a par with the same period of previous fiscal year, although sales in the pest
control devices business declined, sales increased in the Duskin business.
≫ In the Construction Consulting Business, sales significantly increased year on year due to Suzukuri and ACEHOME added tothe business segment since the 1st quarter.
≫ In the Housing Sales Business, sales significantly decreased year on year following the sale of all shares of Leohouse.
≫ In the Beauty and Health Business, sales decreased year on year due to decline in the number of customers. Unauthorizedaccess to the server used at the company’s EC site for online-shopping of cosmetics took place July, 2019. As acountermeasure, we suspended use of EC site for four months.

5

１Operating income by Segments

Note)The figures inside( )marks indicate operating margin.

3 months
ended FY2020

3 months
ended FY2019（Millions of yen）

YOY
Comparison

CreCla491( 12.8 ％)17( 0.6 ％)

+ 474
( + 12.2 pt)

Rental267( 7.6 ％)

443
( 12.6 ％)▲ 176( ▲ 5.0 pt)

Construction
Consulting▲ 25( ▲ 1.3 ％)60( 5.0 ％)▲ 86
( ▲ 6.3 pt)

Housing Sales▲ 156(▲ 9.4 ％)▲ 1,350(▲ 18.2 ％)+ 1,194( + 8.9 pt)

Beauty and Health▲ 67(▲ 3.8 ％)▲ 136(▲ 5.3 ％)+ 68（ + 1.4 pt)

▲ 297

▲ 277

▲ 19

211
( 1.7 ％)

▲ 1,243(▲ 7.0 ％)+ 1,454(+ 8.6 pt)

Elimination,
HQ CostTotal≫ In the CreCla Business, operating income increased year on year due to an increase in the sales in both the directly managed and ouraffiliated stores.
≫ In the Rental Business, operating income decreased year on year due to sales in the pest control devices business, which is highly
profitable, declined.
≫ In the Construction Consulting Business, we posted operating loss. This is because Suzukuri, ACEHOME, and Nac Smart Energy
posted operating loss.
≫ In the Housing Sales Business, operating loss was reduced year on year, following the sale of all shares of Leohouse.
≫ In the Beauty and Health Business, operating loss decreased year on year due to reduction of SG&A expenses, mainly advertisingand advertising expenses at JIMOS.

6

1Analysis for operating income & loss (YoY change)（Millions of yen）
Comparison

FY2019 Q1 Operating Income▲ 1,243-▲ 744▲ 10.4 %Sales promotion costs and Advertising Exp.

＋ 760

+ 50.4 %Personnel expenses+ 449+ 17.4 %Rent and Rent expenses+ 213+ 35.5 %Depreciation and Amortization+ 73+ 18.3 %Commission paid

+ 52

+ 14.3 %＋ 650+ 22.0 %211-

1. Gross profit

2. Increase andDecrease of
SG&A※ Increase and Decrease of SG&A
＋ Increase in profit and loss
▲ Decrease in the profit and loss

Others

FY2020 Q1 Operating Income
1. The reason of increases in Gross profit≫ This is due to a decrease in sales following the sale of all shares of Leohouse.

2. The reason of increases and decreases in SG&A
≫ SG&A expenses decreased following the sale of all shares of Leohouse and the reduction of advertising cost at JIMOS.

7

１

Consolidated Balance Sheet
As of June.30
2020

Break
down

As of Mar.31
2020

Break
down

（Millions of yen）
Comparison

27,25963.7 %

28,85862.1 %▲ 1,599

Total property, plant andequipment

9,247

21.6 %

10,61522.9 %▲ 1,368

Intangible assets

2,084

4.9 %

2,253

4.9 %

▲ 168

Investments and other assets

4,166

9.7 %

4,626

10.4 %▲ 460

15,49836.2 %

17,49637.7 %▲ 1,997

64

0.2 %

78

0.2 %

▲ 13

Total assets

42,822100.0 %

46,433100.0 %

▲ 3,610

Current liabilities

16,70139.0 %

20,12543.4 %▲ 3,423

Non-current liabilities

6,047

14.1 %

6,499

14.0 %▲ 452

Total liabilities

22,74853.1 %

26,62557.4 %▲ 3,876

Shareholder’s equity

20,85848.7 %

20,60144.4 %+ 257

Accumulated other comprehensive
income▲ 835▲ 2.0 %

▲ 844

▲ 1.8 %

＋8

50

0.1 %

50

0.1 %

+0

Total net assets

20,07446.9 %

19,80842.6 %+ 265

Total liabilities and net assets

42,822100.0 %

46,433100.0 %

▲ 3,610

Current assets

Non-current assets
Total deferred assets

Non-controlling interests

Main factors for comparison■ Current assets：Cash and deposits +2,045 Real estate for sale ▲2,067 Costs on uncompleted construction contracts ▲1,063■ Non-current assets：Building and structures ▲5,925 Furniture and fixtures +1,339 Leased asset +3,272■ Current liabilities ：Accounts payable ▲2,772 Short-term loans payable +3,000
Advances received on uncompleted construction contracts ▲1,767■ Non-current liabilities：Long-term loans payable ▲430
8Equity Ratio ： 46.8 ％2. Results by Segments

9

２

Results by Segment (1) CreCla ①

Sales （Millions of yen）
4,000

Directly managed※3,273

3,000

1,077

2,000
1,000
0
Internal transactions
Intersegment transactions

To affiliates※3,103
1,103

2,195

1,999

FY2018 Ｑ1

FY2019 Ｑ1

0
0

0
0

※3,8441,454
2,390

FY2020 Ｑ1
02※The figures in the graph include the above internal transactions and intersegment transactions.（Millions of yen）

≫ In our direct managed stores, while the demand for corporate customers decreased, the demand for household
customers increased due to the increase in time spent at home, therefore sales increased year on year.
≫ In our affiliated stores, sales increased year on year due to the rise in water server sales and the bottle price hike.

Operating（Millions of yen）
Income
500
250

491
87
17

0
FY2018 Q1

FY2019 Q1

FY2020 Q1≫ In the CreCla Business, operating income increased year on year thanks to increased sales.
10２Results by Segment (1) CreCla ②（Millions of yen）

Sales

5,000
4,000

3,273

3,651

3,290

3,000

-2,000

3,467

800

3,388

3,417

3,844
491

443
284

190

1,000

-1,000

3,103

371

2,000

0

2,963

（Millions of yen）

Operating Income

400

285

200

139

87

0

17
Q1

Q2
FY2018

Q3

Q4

600

Q1

Q2
FY2019Q3Q4Q1FY2020-200≫ The CreCla Business invests in advertising during Q1 & Q3 than Q2 & Q4.

11

２

Results by Segment (2) Rental ①

Sales （Millions of yen）
4,000
3,000
2,000
1,000
0
Internal transactions
Intersegment transactions

DuskinWith

Earnest※3,541343
610※3,509335
605※3,526
290
479

2,588

2,568

2,756

FY2018 Q1

FY2019 Q1

FY2020 Q1

0
0

0
0

17
2

※The figures in the graph include the above internal transactions and intersegment transactions.（Millions of yen）

≫In the mainstay Duskin business, rental sales decreased at dust control products department and sales
decreased at care services department. However, we made up for the decrease through selling products.
As a result, the Duskin business increased sales.
≫ In the With-branded pest-control devices business, the main customer, restaurants, were temporary closed
due to COVID-19. Thus, we saw plunge in sales at this business.

Operating （Millions of yen）
431
Income 500

443
267

250
0

FY2018 Q1

FY2019 Q1

FY2020 Q1≫ Operating income decreased due to a decrease in sales of the highly profitable With-branded pestcontrol devices business.

12

２

Results by Segment (2) Rental ②
Sales（Millions of yen）

Operating Income（Millions of yen）

4,500
4,000
3,500

1,000
3,541

3,603

2,000

3,434

3,509

3,802

3,848

3,648

3,508

635

3,000
2,500

3,815

431

515
416

443

502

800
600

530
368

1,500

267

1,000

400
200

500
0

Q1

Q2

Q3

FY2018Q4Q1Q2FY2019

Q3

Q4

Q1

0

FY2020≫ Sales and Operating income hold steady through the year over.
13

２

Results by Segment (3) Construction Consulting ①

Sales（Millions of yen）

ACEHOME

2,500

SuzukuriNac Smart Energy

2,000
1,500

※1,120

1,000

575

500
0

※1,252610

Know-how system※1,949
325
283
437
903

454

640

FY2018 Q1

FY2019 Q1

FY2020 Q1

40
0

36
0

0
0

internal transactions
Intersegment transactions※The figures in the graph include the above internal transactions.（Millions of yen）

≫ From the first quarter of the current consolidated cumulative period, Suzukuri and ACEHOME have been added
to this business segment. So, sales increased from the same period of the previous year.

Operating （Millions of yen）
Income
100
50

49

60
▲25

0
-50

FY2018 Q1

FY2019 Q1

FY2020 Q1≫ We posted operating loss. This is because Suzukuri, ACEHOME, and Nac Smart Energy posted operating loss.
14

Results by Segment (3) Construction Consulting ②

２

Sales

（Millions of yen）

Operation Income（Millions of yen）

1,949

2,000

600

1,626
1,500

1,346

1,405
388

1,080

1,216

1,000

500

0

1,258

192

167

1,409

500
400
300

147

200

60

49

Q1

1,368

330

148

100
▲ 25

Q2
FY2018

Q3

Q4

700

Q1

Q2

Q3

Q4

FY2019Q1

0-100

FY2020≫ Sales and Operating income tend to increase around Q4.

15

２

Results by Segment (4) Housing Sales ①
Note）We sold all of our shareholding in Leohouse on May 14. Consequently, Leohouse was excluded from our consolidated subsidiaries fromthe first quarter of this fiscal year.

Leohouse

Sales （Millions of yen）
8,000
6,000
4,000
2,000
0
Internal transactions
Intersegment transactions※ 5,535

198135
1,226
723

J-woodKDI※ 7,545KUNIMOKU-HOUSE

208 128
1,426
397
5,384

※ 1,670

FY2019 Q1

FY2020 Q1

140
1,203
309

3,251

FY2018 Q1
116
0Suzukuri136
18※The figures in the graph include the above internal transactions and intersegment transactions.（Millions of yen）

00

≫ We sold all of our shareholding in Leohouse to YAMADA DENKI Co., LTD. on May 14. Consequently, Leohouse was excluded
from our consolidated subsidiaries from the first quarter of this fiscal year.
≫ KDI decreased sales year on year, however, increased operating income year on year. This is attributable to the better grossmargin.

Operating（Millions of yen）
Income 0-1,000-2,000FY2018 Q1▲1,640▲167
FY2019 Q1▲1,396FY2020 Q1This segment includes the Amortization of goodwill at
11 million yen related KDI and KUNIMOKU-HOUSE.

≫ Operating loss was reduced year on year since Leohouse was excluded from our consolidated subsidiaries from the firstquarter of this fiscal year.

16

２

Results by Segment (4) Housing Sales ②（Millions of yen）

（Millions of yen）

25,000Sales

20,00018,9081,630

10,0005,000

13,085
10,548
7,408

5,419

-5,000

261

894

▲ 156

▲ 350

▲ 671

1,000

10,108

▲ 144

0

2,000

15,497

15,00011,441

3,000

Operating Income

1,670-1,000▲ 1,350▲ 1,765Q1Q2Q3FY2018

Q4

Q1

Q2

0

Q3

Q4

FY2019Q1-2,000

FY2020≫ Sales and Operating income tend to increase around Q4.
17

２

Results by Segment (5) Beauty and Health ①

Sales（Millions of yen）
3,000

JIMOS

※2,277
109

2,000
1,000
0
Internal transactions
Intersegment transactions

BELAIRJIMOS (TAIWAN)※2,595
96

2,168

2,498

FY2018 Q1

FY2019 Q1

0
6

QOL CLUB※1,789
9
26
91
1,660

FY2020 Q1

1
10

26
4

※The figures in the graph include the above internal transactions and intersegment transactions.（Millions of yen）

≫ JIMOS Co., Ltd., decreased sales year on year. The main factor is decline in the number of customers. Unauthorizedaccess to the server used at the company’s EC site for online-shopping of cosmetics took place July, 2019. As acountermeasure, we suspended use of EC site for four months. Therefore, the number of customers decreased.

Operating
Income（Millions of yen） FY2018 Q1
0

-100
-200
-300

FY2019 Q1

FY2020 Q1

▲67

▲50
▲136

This segment includes Amortization of

goodwill at 141 million yen related to JIMOS
and BELAIR.

≫ Operating loss decreased as a result of reducing SG＆A expenses, mainly advertising expenses, at
JIMOS Co., Ltd.
18

２

Results by Segment（５） Beauty and Health ②
Sales（Millions of yen）

Operating Income（Millions of yen）

4,000
3,000

600

2,277

2,217

2,534

2,771

2,593

500
2,158

2,000
222

1,000
0
!(1,000!)

2,005

41
Q2

▲ 50

▲ 49

Q3

Q4

Q1

Q2

Q3

FY2018

400
300
200

44
Q4

100
Q1
▲ 67

▲ 136

!(2,000!)

1,763

175

132
Q1

2,006

0
-100
-200

FY2019FY2020≫ Sales and operating income generally are tilted toward the second half of the year due to aggressive investment inadvertising and promotions the first half of the year.

193. FY2020 Forecasts of Financial Results

20

3

FY2020 Forecasts of Financial Results

Regarding business forecasts, as all business segments are heavily
affected by COVID-19 and the future outlook remains uncertain, it
is difficult to reasonably calculate the impact amount at this time.
We will announce it as soon as it becomes possible to disclose thebusiness forecast.

21

4. Plan of Dividends

22

4Plan of dividends : Dividend Policy with DOE 4%
Dividend payout ratio is within 100%

（yen）

30

20

26

18
13

10

-

9

8

FY2017FY2018FY2019FY2020（Ex）

Interim Year-end Interim Year-end Interim Year-end
Dividends pershare

18 yen34 yen22 yenUndecided23

5. Appendix

245Company's outline（As of the end of March 2020）

Company name

NAC CO., LTD.

Head office

Shinjuku Center Building, 1-25-1 Nishi-shinjuku Shinjuku-ku, Tokyo

EstablishedMay 1971

President

Kan Yoshimura

Businesses■ CreCla（Production and sale of bottled water）■ Rental（Duskin franchise business, pest control machine rental, regular cleaning plan）■ Construction Consulting（Construction know-how, solar energy systems）■ Housing Sales（Contract construction of a custom-built house, finance and insurance affairs
with housing sales）■ Beauty and Health (Cosmetics and health food mail-order sales)

Consolidated
companies

Earnest Co., Ltd.（Building maintenance）
JIMOS Co., Ltd. （Beauty and Health）
BELAIR Co., Ltd. (Beauty and Health)J-wood Co., Ltd. （Housing Sales）
Nac Smart Energy Co., Ltd.（Sales of energy-saving products ・Construction）
KDI CORPORATION （Housing Sales）
Nac life partners Co., Ltd. （Housing Sales）
KUNIMOKU-HOUSE Co., Ltd. （Housing Sales）
Suzukuri Co., Ltd. （Housing Sales）
ACEHOME Co., Ltd.（Housing franchise）
JIMOS TAIWAN Co., Ltd. (Beauty and Health)
QOL CLUB CO., LTD. (Beauty and Health)

Employees

2,237(consolidated)

Capital stock

6,729,493,750 yen

Number of shares

24,306,750 shares (share unit :100 shares）

Number ofshareholders

14,483 (Total number of shareholders; treasury shares are excluded)25

5

Key Financial Indicators（Consolidated）
FY2019FY2018Comparison

22,405,194 shares

19,802,890 shares+ 2,602,304 shares

Net assets per share（BPS）

881.83 yen

899.84 yen▲ 18.01 yen

Net income per share（EPS）

22.94 yen40.32 yen▲ 17.38 yen

Equity ratio

42.6 %

40.6 %+ 2.0 pt

Ratio of shareholder’sequity to Net income
（ROE）

2.6 %

4.7 ％

▲ 2.1 pt

Dividends per share

22 yen34 yen▲ 12 yen

Dividend ratio

95.9%

84.3 %+ 11.6 pt

Ratio of dividends toshareholder’s equity

2.5 %

3.9 %

▲ 1.4 pt

Average number ofshares during the period26

5Company History

May. 1971

Established Duskin Tsurukawa in Machida city

Aug. 1977

Changed company name to NAC CO., LTD.

Sep. 1995

Listed on the JASDAQ market

Jan. 1997

Listed on the 2nd section of the Tokyo Stock Exchange

Sep. 1999

Listed on the 1st section of the Tokyo Stock ExchangeDec. 2001

Started bottled water “CreCla” delivery businessFeb. 2002

Started housing sales business through Leohouse

Mar. 2010

Achieved 50 billion yen of sales when celebrating its 40th year

Mar. 2012

Acquired Earnest Co., Ltd.

Jul. 2013

Acquired JIMOS Co., Ltd. & J-wood Co., Ltd.

Apr. 2015

Opened the CreCla Honjo-Plant

Sep. 2015

Acquired Eco & Eco Co., Ltd.

May. 2016

Acquired KDI Co., Ltd.

Dec. 2016

Acquired BELAIR Co., Ltd.

Apr. 2017

Acquired Suzukuri Co., Ltd.

Jun. 2017

Acquired KUNIMOKU HOUSE Co., Ltd.

Feb. 2020

Acquired ACEHOME Co., Ltd.

May. 2020

Sold all of our shareholding in Leohouse Co., Ltd.

27

5

Positioning in a market of each business
CreCla■Market leader in the bottled water production■First HACCP certified business in the industry■First Eco Mark certified business in the industry■First in the industry to open an R&D center

Rental■Highest sales of all Duskin franchisees（out of approximately 2,000 companies）■With-branded pest control devices for restaurants first in the industry to be approved by
Ministry of Health, Labour and Welfare

Construction
Consulting■Nacmembers( Construction company :7,000 )■Providing support for affiliated building firms through order promotion and cost reduction
services, including solar power systems and products for Smart House.
■We acquired Nac Smart Energy Co., Ltd. (September, 2015) that deals with energy-saving
products.(formerly Eco & Eco Co., Ltd.)■We acquired Suzukuri Co., Ltd. that perform business in a matrix concept.(Changed from thehousing business segment in April 2020)■We acquired ACEHOME Co., Ltd. (February, 2020) that develops a housing franchise business.

Housing
Sales■Acquired J-wood Co., Ltd. (July 2013) that produces natural houses■We acquired KDI Co., Ltd. that deal with subdivided housing unit and custom-built house in
metropolitan area.
■We acquired KUNIMOKU HOUSE Co., Ltd. that expands the housing sales business in Hokkaido.

Beauty and
Health■In July 2013, the mail-order business entry by a subsidiary of JIMOS Co., Ltd.
■Various cosmetics for skin and hair care suitable for repeat use female customers(mainly in their 40-60’s)■We acquired BELAIR Co., Ltd(December, 2016).
28

5

FY2019 Sales and Operating income Breakdown

CleClaBeauty and Health
Housing Sales

RentalConstruction Consulting

CreCla52%

17%88,222 million

Beauty and Health

Construction Consulting

CreCla32％

23％

RentalSales

RentalConstruction
Consulting

15%

Housing
Sales

CleClaBeauty and
Health

4％ Operating
Income2,118 million
Beauty and
Health

6% 10%

Rental58％

Construction
Consulting

Housing
Sales▲17％※except HQ-costs

Operating margin on sales
CreClaRentalConstruction
Consulting

Beauty and
Health

Housing Sales

Total

7.7%

12.5%

13.9%

1.43％

▲1.2%

2.4%
29

5

Operating income trend by segment≫ Regarding business forecasts, as all business segments are heavily affected by COVID-19 and the future outlook
remains uncertain, it is difficult to reasonably calculate the impact amount at this time.

500【Beauty and Health】

12/3

13/3

-199

-222

-105

-457

14/3

15/3

16/3

17/3

4,000

18/3

2,000

125

19/3

0

-500

-1,0001,500

Closure of
unprofitablebranches

3,003

1,858
388
12/3

13/3

14/3

15/3

-412

-622

-736

-694

-545

16/3

17/3

18/3

19/3

20/3

775

754

730

18/3

19/3

20/3

21/3Ex【CreCla】

1,000

529

576

12/3

13/3

143

14/3

15/3

1,030

788

596

375

500
0

2,686

1,000

20/3 21/3Ex-250(Millions of yen）

【Housing Sales】

3,000

255

147

250
0

(Millions of yen）

Actively advertising
investment(Millions of yen）

274
-201
16/3

17/3

18/3

19/3

20/3

21/3Ex-500(Millions of yen）
2,500
2,000
1,500

(Millions of yen）

【Rental】

1,535

1,582

1,738

1,841

1,853

2,021

1,998

1,500

【Construction Consulting】

1,844

1,505

976

1,000
543

1,000

900

1,146

956

670

500

500
0
-500

0
12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3Ex

12/3

13/3

14/3

15/3

16/3

17/3

21/3Ex-500

30