Consolidated Financial Statements
for the First Quarter of the Fiscal Year Ending March 31, 2024 [J-GAAP]
August 3, 2023

NIPPON KANZAI Holdings Co., Ltd.
Listed exchange:
Tokyo Stock Exchange, Prime Market
Securities code:
9347
URL: https://www.nkanzaihd.co.jp/en/
Representative:
Shintaro Fukuda, President and Representative Director
Contact:
Shigeki Okamoto, Senior Executive Officer and Head of Finance & Accounting Dept.
Telephone:+81-3-5299-0863
Filing date of quarterly report:
August 10, 2023
Date to start dividends distribution:―
Supplementary materials for quarterly results: None
Quarterly results briefing meeting held:
None*Amounts below one million yen have been rounded down.

1. Consolidated results for the first quarter ended June 30, 2023 (April 1, 2023 to June 30, 2023)(1) Consolidated business results(Percentage figures indicate the rate of change from the same period of the previous fiscal year.)
Net Sales
Operating Income
Ordinary Income

Three months ended June 30, 2023
Three months ended June 30, 2022
(Note) Comprehensive income:Millions of yen%

Millions of yen%

Millions of yen%

27,603
―

―
―

2,010
―

―
―

2,378
―

―
―

Three months ended June 30, 2023:
Three months ended June 30, 2022:
Profit Attributable to
Owners of Parent
Millions of yen

[ ―%]
[ ―%]

¥1,751 million¥ ― million

Profit per Share%

Diluted Profit per Share
Yen

Yen

1,533
―
41.03
―
Three months ended June 30, 2023――――
Three months ended June 30, 2022
(Note) Since the Company was established on April 3, 2023, through a sole share transfer, there are no results for the same period of theprevious fiscal year.

(2) Consolidated financial position

Total Assets

Net Assets

Millions of yen

84,574―As of June 30, 2023
As of March 31, 2023
(Reference) Equity:

Equity Ratio

Millions of yen%

66,110―76.9―

As of June 30, 2023:¥65,052 million
As of March 31, 2023: ¥ ― million(Note) Since the Company was established on April 3, 2023, through a sole share transfer, there are no results for the previous fiscal year.

2. Dividends
First
Quarter-end

Yen

SecondQuarter-end

Yen

Annual dividends
Third
Quarter-end

Year-end

Yen

Total
Yen

Yen

―
―
―
―
―
Fiscal year ended March 31, 2023―
Fiscal year ending March 31, 2024
Fiscal year ending March 31, 2024
27.00
―
27.00
54.00
(forecast)(Note) 1. Revisions to the most recently announced forecast of cash dividends in the current quarter: None
2. Since the Company was established on April 3, 2023, through a sole share transfer, there are no results for the previous fiscal year.

3. Consolidated business forecasts for the fiscal year ending March 31, 2024 (April 1, 2023 to March 31, 2024)(Percentage figures for the full year indicate the rate of change from the previous fiscal year.
Percentage figures for the first six months indicate the rate of change from the same period of the previous fiscal year.)
Profit Attributable toProfitNet Sales
Operating Income
Ordinary Income
Owners of Parent
per Share
Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

55,800
3,900
4,200
2,750
73.56
First half――――
118,600
8,600
9,100
6,000
160.50
Full year――――(Note) 1. Revisions to the most recently announced consolidated business forecasts in the current quarter: None
2. Since the Company was established on April 3, 2023, through a sole share transfer, there is no rate of change from the previous fiscal
year and that from the same period of the previous fiscal year.

* Notes(1) Changes of significant subsidiaries during the period (changes in specific subsidiaries associated with changes
in scope of consolidation): None
(2) Adoption of specific accounting methods for preparation of the quarterly consolidated financial statements:
None(3) Changes in accounting policies, accounting estimates and restatement of revisions
1) Changes in accounting policies due to revisions of accounting standards, etc.:
None2) Changes in accounting policies other than 1) above:None3) Changes in accounting estimates:
None4) Restatement of revisions:
None(4) Number of shares issued and outstanding (common stock)1) Number of shares issued and outstanding (including treasury stock)2) Number of treasury stock3) Average number of shares issued and outstanding
1)

As of June 30, 2023

41,180,306 shares

As of March 31, 2023

― shares2)

As of June 30, 2023

3,797,260 shares

As of March 31, 2023

― shares3)

Quarter ended June 30,
2023

37,383,123 shares

Quarter ended June 30,2022― shares(Note) Since the Company was established on April 3, 2023, through a sole share transfer, there are no results for the previous fiscal
year and the same period of the previous fiscal year.

* This quarterly financial report is not included in the quarterly review by certified public accountants or audit
corporations* Explanation regarding the appropriate use of business forecasts and other notes(Notes to forward-looking statements)
The business forecasts reported herein were prepared based on information the Company had in its possession as of thetime this report was prepared and on certain assumptions judged to be reasonable. Actual results may differ significantly
from forecasts due to various factors. Please refer to the disclaimers provided under “1. Qualitative information on
financial statements; (3) Explanation regarding information on future forecasts including consolidated business forecasts,etc.” on page 3 of the Attached Document of this quarterly financial report regarding assumptions upon which forecasts
are based and the use of forecasts.
(Results for the previous fiscal year and the same period of the previous fiscal year)
Since the Company was established on April 3, 2023, through a sole share transfer of NIPPON KANZAI Co., Ltd., thecurrent fiscal year will be its first fiscal year. Therefore, there are no results for the previous fiscal year and the same
period of the previous fiscal year.

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

Table of Contents for the Attached Document
1. Qualitative information on financial statements .................................................................................................... 2(1) Explanation regarding business results ................................................................................................................ 2(2) Explanation regarding financial position ............................................................................................................. 3(3) Explanation regarding information on future forecasts including consolidated business forecasts, etc. .................3
2. Quarterly consolidated financial statements and key notes.................................................................................... 4(1) Quarterly consolidated balance sheets ............................................................................................................... 4(2) Quarterly consolidated statements of income and quarterly consolidated statements of comprehensive
income ............................................................................................................................................................... 6
Quarterly consolidated statements of income.................................................................................................... 6
Quarterly consolidated statements of comprehensive income ........................................................................... 7(3) Notes on quarterly consolidated financial statements ....................................................................................... 8(Notes on the going concern assumption) ......................................................................................................... 8(Notes on significant changes in the amount of shareholders’ equity) ............................................................... 8(Segment information, etc.) ............................................................................................................................... 81

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

1. Qualitative information on financial statements
The Company was established on April 3, 2023, through a sole share transfer of NIPPON KANZAI Co., Ltd. As for thescope of consolidation, there is no substantial change from the scope of consolidation of NIPPON KANZAI Co., Ltd.
In addition, the quarterly consolidated financial statements for the first quarter of the fiscal year ending March 31, 2024,
are prepared by succeeding the quarterly consolidated financial statements of NIPPON KANZAI Co., Ltd., which has
become a wholly owned subsidiary through the sole share transfer.

(1) Explanation regarding business results
During the first quarter of the fiscal year ending March 31, 2024, the Japanese economy saw normalization due to thelifting of restrictions imposed because of the COVID-19 pandemic and the reclassification of COVID-19 as Class 5,
but was faced with concerns of stagnation in economic activity due to the impact of surging raw material prices causedby the prolonged situation in Ukraine and currency exchange fluctuation risks. These factors still continue to castuncertainty over the future.
The real estate services industry saw vacancy rates for office buildings and retail facilities in urban areas remain highas various work arrangements including remote working and satellite offices started to take hold. In addition, withsurging raw material prices and rising labor costs leading to client companies becoming more conscious of reducing
costs, a severe business environment is expected to continue going forward.
In such a business environment, the Nippon Kanzai Group (hereinafter the “Group”) has continued to pursue“optimal building management” through its advanced technologies and responsiveness in order to continuously provide
high-quality services that match customer needs, endeavoring to enhance the asset value of buildings.
The Group has also endeavored to further strengthen and improve Building Management and Operations, its corebusiness, while proactively implementing operations in peripheral fields such as private finance initiatives (PFI) andpublic facility management projects.
In the first quarter of the fiscal year ending March 31, 2024, our successful winning of new management contracts
and renewing contracts resulted in net sales of 27,603 million yen, operating income of 2,010 million yen, ordinary
income of 2,378 million yen, and profit attributable to owners of parent of 1,533 million yen.
The following are business results by segment.
Segment income has been adjusted to operating income described in quarterly consolidated statements of income.
Building Management and Operations
With regard to Building Management and Operations, the Group’s core business that focuses on building management
and security services, smoothly winning new management contracts and renewing contracts resulted in net sales for thesegment for the first quarter of the fiscal year ending March 31, 2024, of 18,079 million yen and segment income of
1,682 million yen.
Residential Management and Operations
With regard to Residential Management and Operations, which mainly consists of managing rental apartment buildings
and condominiums as well as public housing, the robust renewing of existing management contracts and strong
construction-related business orders contributed to the net sales for the segment for the first quarter of the fiscal year
ending March 31, 2024, of 4,721 million yen and segment income of 443 million yen.
Environmental Facilities Management
With regard to Environmental Facilities Management, which mainly consists of managing water treatment, sewage
disposal, and other public facilities related to the overall living environment, the robust renewing of existing
management contracts and strong construction-related business orders contributed to the net sales for the segment for
the first quarter of the fiscal year ending March 31, 2024, of 3,457 million yen and segment income of 604 million yen.
Real Estate Fund Management
With regard to Real Estate Fund Management, which mainly consists of asset management (i.e., arrangement and asset
management of real estate funds) and handling of investments in silent partnership, smoothly implementing facility
management and operation business resulted in net sales for the segment for the first quarter of the fiscal year ending
March 31, 2024, of 796 million yen and segment income of 152 million yen.
Other Businesses
In Other Businesses, which consist mainly of event planning and management, design and payroll accounting services,smoothly winning event-related business contracts resulted in net sales for the segment for the first quarter of the fiscal
year ending March 31, 2024, of 623 million yen and segment income of 83 million yen.

2

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

(2) Explanation regarding financial position
Total assets at the end of the first quarter of the fiscal year ending March 31, 2024, amounted to 84,574 million yen.
The major breakdown is 48,064 million yen of current assets including 30,052 million yen of cash and deposits and
36,509 million yen of non-current assets including 20,392 million yen of investment securities.
Liabilities amounted to 18,463 million yen. The major breakdown is 13,085 million yen of current liabilities
including 4,586 million yen of notes and accounts payable-trade and 5,378 million yen of non-current liabilities
including 2,107 million yen of guarantee deposited.
Net assets amounted to 66,110 million yen. The major breakdown is 63,256 million yen of shareholders’ equity
including 59,245 million yen of retained earnings, 1,796 million yen of accumulated other comprehensive income
including 2,436 million yen of valuation difference on available-for-sale securities, and 1,057 million yen of noncontrolling interests. The equity ratio was 76.9%.
(3) Explanation regarding information on future forecasts including consolidated business forecasts, etc.
The Group remains cautious of the future business environment, which continues to be unpredictable.
The Group’s business performance has been generally in line with the forecasts announced on May 9, 2023, andthere are no changes to the full-year business forecasts.

3

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

2.

Quarterly consolidated financial statements and key notes(1) Quarterly consolidated balance sheets

ASSETS
Current assets
Cash and deposits
Notes, accounts receivable－trade and contract assets
Investments in silent partnership for business purposes
Real estate for sale
Supplies
Income taxes receivable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Tools, furniture and fixtures, net
Land
Leased assets, net
Total property, plant and equipment
Intangible assets
SoftwareLeased assets
Goodwill
Telephone subscription right
Software in progress
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Deferred tax assets
Long-term prepaid expenses
Net defined benefit asset
Lease and guarantee deposits
Membership
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
TOTAL ASSETS(Millions of yen)First quarter ended
June 30, 2023
(As of June 30, 2023)

30,052
13,677
59
2,122
270
306
1,581
(7)
48,064
3,950
26
619
1,211
633
6,442
359
7
1,755
48
169
2,340
20,392
812
184
17
801
3,417
355
1,800
(54)
27,72736,50984,574*English translation of some items has been changed to correspond with EDINET taxonomy published by FSA.

4

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

(Millions of yen)First quarter ended
June 30, 2023
(As of June 30, 2023)

LIABILITIESCurrent liabilities
Notes and accounts payable－trade
Current portion of long-term loans payable
Current portion of long-term non-recourse loans payable
Lease obligations
Accrued expenses
Income taxes payable
Accrued consumption taxes
Contract liabilities
Deposits received
Provision for bonuses
Other
Total current liabilities
Non-current liabilities
Long-term non-recourse loans payable
Lease obligations
Deferred tax liabilities
Provision for retirement benefits for directors (and other officers)
Net defined benefit liability
Long-term guarantee deposited
Asset retirement obligations
Liabilities from application of equity method
Other
Total non-current liabilities
TOTAL LIABILITIESNET 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
Non-controlling interests
TOTAL NET ASSETSTOTAL LIABILITIES AND NET ASSETS

4,586
281
678
183
2,831
329
1,433
1,769
828
102
62
13,085
289
473
1,159
0
227
2,107
448
7
662
5,378
18,4633,000
11,33959,245(10,328)
63,256
2,436
(396)
(243)
1,796
1,057
66,11084,574*English translation of some items has been changed to correspond with EDINET taxonomy published by FSA.

5

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

(2) Quarterly consolidated statements of income and quarterly consolidated statements of comprehensive income
Quarterly consolidated statements of income(Millions of yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Selling expenses
Personnel expenses
Provision for bonuses
Provision for retirement benefits for directors (and other officers)
Retirement benefit expenses
Transportation and communication expenses
Supplies expenses
Rent expenses
Insurance expenses
Depreciation
Taxes and duesEnterprise tax
Provision of allowance for doubtful accounts
Amortization of goodwill
Other
Total selling, general and administrative expenses
Operating income
Non-operating income
Interest and dividend income
Rent income
Share of profit of entities accounted for using equity method
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Rent expenses
Loss on sales and retirement of non-current assets
Other
Total non-operating expenses
Ordinary income
Profit before income taxes
Income taxes－current
Income taxes－deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

Three months ended
June 30, 2023
(April 1, 2023 toJune 30, 2023)
27,603
21,263
6,339

189
2,473
49
0
79
289
132
329
86
126
92
84
(0)
51
344
4,329
2,010
73
14
16
288
26
418
6
17
17
9
50
2,378
2,378
444
382
827
1,550
16
1,533

*English translation of some items has been changed to correspond with EDINET taxonomy published by FSA.

6

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

Quarterly consolidated statements of comprehensive income(Millions of yen)Three months ended
June 30, 2023
(April 1, 2023 toJune 30, 2023)
1,550

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities accounted for using
equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

413
(251)
20
17
200
1,751
1,721
30

*English translation of some items has been changed to correspond with EDINET taxonomy published by FSA.

7

NIPPON KANZAI Holdings Co., Ltd. (9347) Consolidated Financial Statements for the First Quarter of the Fiscal Year Ending March 31, 2024

(3) Notes on quarterly consolidated financial statements(Notes on the going concern assumption)
Not applicable.
(Notes on significant changes in the amount of shareholders’ equity)
Not applicable.
(Segment information, etc.)
Three months ended June 30, 2023 (April 1, 2023 to June 30, 2023)
Information on net sales, and income or losses for each reportable segment(Millions of yen)

Reportable segment

Amountrecorded on
Adjustments
quarterly(Note 1)
consolidated
statements ofincome (Note 2)

Building
Management
andOperations

Residential
Management
andOperations

18,079

4,721

3,457

796

548

27,603―27,603

―

―

―

―

75

75

(75)

―

18,079

4,721

3,457

796

623

27,678(75)

27,603

1,682

443

604

152

83

2,967

(957)

2,010

Environmental Real Estate
Facilities
Fund
Management Management

Other
Businesses

Total

Net sales
Net sales toexternal customers
Inter-segment net
sales and transfer
Total
Segment income(loss)(Note) 1. Adjustments of -957 million yen for segment income (loss) are elimination of inter-segment transactions and unallocated generaladministrative expenses.
2. Segment income (loss) has been adjusted to operating income described in quarterly consolidated statements of income.

8