2019

Semiannual Report
For the six-month period ended September 30, 2018

TONAMI HOLDINGS CO., LTD.

Contents
1
2

To Our Shareholders and Investors
Overview of Operations
Results by Segment
3 Unaudited Consolidated Financial Highlights
4 Unaudited Consolidated Balance Sheets
6 Unaudited Consolidated Statements of Income and		 Consolidated Statements of Comprehensive Income
7 Unaudited Consolidated Statements of Cash Flows
8 Notes to the Unaudited Consolidated Financial Statements
10 Consolidated Subsidiaries
11 Board of Directors and Corporate Auditors
11 Corporate Data

Forward-Looking Statements
This report includes forward-looking statements that represent Tonami Group’s assumptions and expectations in light of currently available information.
These statements reflect industry trends, clients’ situations and other factors, and involve risks and uncertainties which may cause actual performance
results to differ from those discussed in the forward-looking statements in accordance with changes in the business environment.

To Our Shareholders and Investors
I welcome this opportunity to report to ourIn the logistics industry, while a tight labor supply/

shareholders and investors on the Group’s operating

demand situation and concerns over wage increases

environment and business results for the six-monthpersist, it is becoming necessary to implement effective

period ended September 30, 2018.

measures to ensure an appropriate transaction

Whereas many listed companies in Japan, mainly

environment and appropriate working hours inmanufacturers, expect increases in revenues and profit

accordance with the work-style reform-related laws

for the full year based on their results for the first six-that will come into force on April 1, 2019.

month period of the fiscal year ending March 31,

In these circumstances, in the first year of the 21st2019, the stock market reflected concerns over the

Medium-Term Business Plan, the Group will continue

slowdown of the global economy and stock prices haveits efforts to establish a high-value-added profit

been declining. Therefore, it is important to identify

structure, including collection of appropriate freight

concerns such as the U.S.-China trade friction.

charges, in order to promote work-style reform ahead

In its efforts to continue to offer high-quality logistics

of enforcement of the laws and strengthening ofservices, having set work-style reform as a pillar oftransportation capabilities.

management and setting the three years from April 1,

In all our endeavors, we will be grateful for your2018 to March 31, 2021 as the period in which thecontinued support and guidance.

Group is to evolve into an enterprise capable ofachieving stable growth, the Group formulated theDecember 2018

21st Medium-Term Business Plan centering on six
reforms with a corporate slogan “Try & Growth 2020
— Evolving into a continuous growth company!” andKatsusuke Watanuki
President and Representative Director

is working to strengthen the management foundationfor ensuring business continuity.
As a result, regarding the Group’s consolidated
operating results for the six-month period ended
September 30, 2018, operating revenues amounted to¥67,369 million, an increase of 5.3% from the same
period of the previous year. Operating income
increased 31.7% to ¥3,505 million, ordinary income
increased 23.3% to ¥3,650 million, and net income
attributable to owners of the parent increased 25.2%
to ¥2,297 million.
In view of these operating results, the Company isplanning to pay out an interim dividend of ¥40 per
share.

1

Overview of Operations

Results by Segment

In the logistics industry, the business environment
remains challenging, such as a sharp increase in theprice of crude oil and labor shortages.
In pursuit of “a comfortable working environment andwork-style reform,” the Group is continuing initiatives
aimed at “improvement of hourly productivity per
worker” and “building a safe, secure and stable work
environment,” as well as “promotion of hiring
activities” to cope with the progress of population
aging and the shrinking of the workforce, andimprovement of human-resource retention through“introduction of a mentor program.”Moreover, we strove to enhance our logistics services
by implementing meticulous strategies attuned to thecompetitive environment and regional characteristics
relevant to each of our business sites and increasing
the quality and speed of sales and marketing activities
to achieve good results.
Amid such circumstances, in the road haulage businessand the freight forwarding business, we conductedsales and marketing to further expand business by
expanding sales to new customers and deepening
relationships with existing customers. By offering
proposals from the viewpoint of total optimization oflogistics through precise identification of real needs ofcustomers, we strove to expand our businesses,
including third-party logistics (3PL), as an area of
focus.
As a result, the Group’s operating revenues during thesix-month period ended September 30, 2018
amounted to ¥67,369 million, an increase of 5.3%
from the same period of the previous year.
With regard to profits, owing to increased revenues asa result of negotiations to revise freight charges andinitiatives such as thorough profit management
through cost control and improvement of productivityof existing businesses, operating income increased
31.7% to ¥3,505 million from the same period of theprevious year, ordinary income increased 23.3% to¥3,650 million, and net income attributable to ownersof the parent increased 25.2% to ¥2,297 million.

In the logistics-related business, we strove to win
contracts with new customers by making proposals
utilizing the entire Group’s resources. With regard to
existing customers, while continuing negotiations torevise freight charges according to transportation costs,
we worked to enhance efficiency of pick-up anddelivery operations through reduction of the workload
by clearly distinguishing between forwarding andancillary work. As a result, operating revenues
amounted to ¥62,117 million, an increase of 4.7%
from the same period of the previous year. Segment
income was ¥3,224 million, an increase of 33.6%
from the same period of the previous year owing to
the positive impact of revisions to freight charges,
improved transportation efficiency, and enhanced
operation of distribution centers.
Operating revenues from the information processing
business were ¥1,318 million, an increase of 2.5%
from the same period of the previous year. Segment
income was ¥169 million, an increase of 38.7% fromthe same period of the previous year.
Operating revenues from the sales business, which
includes merchandising, consignment sales, and anon-life insurance agency, amounted to ¥3,052
million, an increase of 20.1% from the same period of
the previous year. Segment income was ¥61 million, adecrease of 14.6% from the same period of theprevious year.
Operating revenues from other businesses, which
include automobile repair and other services,amounted to ¥881 million, an increase of 10.3% fromthe same period of the previous year. Segment income
was ¥72 million, an increase of 23.3% from the same
period of the previous year.

2Unaudited Consolidated Financial Highlights
TONAMI HOLDINGS CO., LTD. AND CONSOLIDATED SUBSIDIARIESSix months
ended
September 30,
2018

Six months
ended
September 30,
2017

Thousands of
U.S. dollars(Note 1)
Six months
ended
September 30,
2018¥67,369
62,117
1,318
3,052
881
3,505
2,297
3,202

¥ 63,97859,352
1,286
2,540
798
2,660
1,835
2,586

$593,199
546,955
11,611
26,875
7,759
30,863
20,23328,196¥253.49—
40.00¥202.37
—
4.00

$

September 30,
2018

March 31,2018

September 30,
2018¥132,178
67,089¥128,953
64,257$1,163,855
590,728

Millions of yen

For the period:
Operating revenues .........................................................................
Logistics ......................................................................................
Information processing ...............................................................
Sales ...........................................................................................
Others ........................................................................................
Operating income ...........................................................................
Net income attributable to owners of the parent ..............................
Total comprehensive income ...........................................................
Per share (yen and U.S. dollars) (Note 2,5)
Net income, basic ...........................................................................
Net income, diluted (Note 3)...........................................................
Cash dividends ...............................................................................
At period-end:
Total assets (Note 4)........................................................................
Total net assets (Note 4)...................................................................
Notes:

2.2320—0.3522

1. These financial statements are in principle presented in Japanese yen, and U.S. dollar amounts presented herein are included solely for the convenience of readers outside Japan.
The rate of ¥113.57 = U.S.$1, prevailing on September 28, 2018, has been used for the translation into U.S. dollar amounts. Such translation should not be construed as
representations that the Japanese yen amount can be or have been converted into U.S. dollars at that rate.
2. The computation of net income per share of common stock is based on the weighted average number of shares outstanding (which represents the number of issued shares lesstreasury stock) during each period.
3. Diluted net income per share is not presented for the six months ended September 30, 2018 and 2017, since there were no potentially dilutive securities.
4. Effective from the beginning of the fiscal year ending March 31, 2019, the Company has applied “Partial Amendments to Accounting Standard for Tax Effect Accounting, etc.”(ASBJ Statement No. 28, February 16, 2018) and other standards. Figures presented for key performance indicators, etc. for the first six-month period of the previous fiscal year
and the previous fiscal year are after retrospective application of the said accounting standards.
5. The Company conducted a 1-for-10 reverse stock split of its shares of common stock effective October 1, 2017. Accordingly, net income per share was calculated under theassumption that the said reverse stock split had been conducted on April 1, 2017 (at the beginning of the fiscal year ended March 31, 2018).

3

Unaudited Consolidated Balance Sheets

TONAMI HOLDINGS CO., LTD. AND CONSOLIDATED SUBSIDIARIES
September 30, 2018 and March 31, 2018

Millions of yen
September 30,
March 31,
2018
2018

Thousands of
U.S. dollars(Note 1)
September 30,
2018¥18,011¥17,283$ 158,591

ASSETS
Current assets:
Cash and time deposits .........................................................................
Trade receivables:
Notes and accounts .........................................................................

21,98422,028

193,577

Less: allowance for doubtful accounts .............................................

(148)

(17)

(1,307)

Inventories (Note 2) .............................................................................

842

552

7,414

Deferred tax assets ................................................................................

—

0

0

Income taxes receivable.........................................................................

233

559

2,059

Other current assets ..............................................................................

2,676

2,238

23,568

Total current assets .................................................................

43,59942,644

383,902

Land ....................................................................................................

41,117

40,844362,046

Buildings and structures .......................................................................

19,24019,521

169,417

Property and equipment:

Machinery and vehicles ........................................................................

2,636

2,629

23,218Other ...................................................................................................

8,303

7,674

73,110Total property and equipment ...............................................

71,29870,669627,791

10,9799,654

96,675

Deferred tax assets ................................................................................

719

744

6,337

Goodwill ..............................................................................................

431

67

3,800

Investments and other assets:
Investments in securities .......................................................................

Other ...................................................................................................

5,150

5,173

45,350Total investments and other assets ..........................................

17,281

15,639152,162

Total assets .............................................................................

¥132,178¥128,953$1,163,855

The accompanying Notes are an integral part of these statements.

4

LIABILITIESCurrent liabilities:
Short-term bank loans ..........................................................................
Current portion of long-term debt .......................................................
Trade notes and accounts payable ........................................................
Income taxes payable ............................................................................
Other current liabilities ........................................................................
Total current liabilities ...........................................................
Long-term liabilities:
Long-term debt, less current portion thereof ........................................
Deferred tax liability .............................................................................
Deferred tax liabilities from revaluation reserve for land .......................
Retirement benefits for directors and corporate auditors ......................
Net defined benefit liability ..................................................................
Provision for loss on guarantees ............................................................
Other long-term liabilities ....................................................................
Total long-term liabilities .......................................................
Total liabilities .......................................................................

Millions of yen
September 30,
March 31,
2018
2018

Thousands of
U.S. dollars(Note 1)
September 30,
2018¥9,748
4,137
12,303
1,527
10,34638,063¥9,700654
12,484
1,522
10,25034,612$85,837
36,430108,337
13,452
91,103
335,159

7,407
2,332
3,765
174
6,935
57
6,354
27,02665,08910,953
1,896
3,765
153
6,931
57
6,326
30,08364,69665,222
20,541
33,154
1,532
61,067503
55,949237,968
573,127

NET ASSETS
Shareholders’ equity:
Common stock:
Authorized: 29,920,000 shares at September 30, 201829,920,000 shares at September 30, 2017
Issued: 9,761,011 shares at September 30, 2018
9,761,011 shares at September 30, 2017.............................
Capital surplus .....................................................................................
Retained earnings .................................................................................
Treasury stock: 696,246 shares at September 30, 2018 and
693,035 shares at September 30, 2017 ........................
Total shareholders’ equity .......................................................

14,182
11,69932,705

14,182
11,69930,770124,880
103,013287,974(2,060)56,526(2,055)54,596(18,142)
497,726

Accumulated other comprehensive income:Unrealized gain on securities ................................................................
Revaluation reserve for land .................................................................
Remeasurements of defined benefit plans .............................................
Total accumulated other comprehensive income ....................

3,793
6,352
375
10,521

2,901
6,352
368
9,623

33,39855,9393,303
92,640Minority interests:
Minority interests ................................................................................
Total net assets .......................................................................
Total liabilities and net assets .................................................

41
67,089¥132,17837
64,257¥128,953

362
590,728$1,163,855

5Unaudited Consolidated Statements of Income andConsolidated Statements of Comprehensive Income
TONAMI HOLDINGS CO., LTD. AND CONSOLIDATED SUBSIDIARIESFor the six months ended September 30, 2018 and 2017

2017

Thousands of
U.S. dollars(Note 1)
2018

¥67,369
67,369¥63,978
63,978$593,199
593,199

60,3093,555
63,864
3,505

57,851
3,465
61,3172,660

531,033
31,303562,336
30,863

193
33
26
(109)
(11)
132
3,637

206
67
41
(114)
101
302
2,963

1,705
291
236
(964)
(101)
1,167
32,030

1,259
73
1,333
2,304
6
¥2,297
6
2,304

1,035
88
1,124
1,839
3
¥1,835
3
1,839

11,091
650
11,74020,29056$20,233
56
20,290

890
6

706
38

7,842
55

1
897
3,202

1
747
2,586

10
7,906
28,196

3,195
6

2,582
3

28,14056

Millions of yen
2018

Operating revenues:
Operating revenues (Note 8).................................................................
Operating costs and selling, general and administrative expenses:
Operating cost ......................................................................................
Selling, general and administrative expenses (Note 4)............................
Operating income
Other income and expenses:
Interest and dividend income ...............................................................
Equity in earnings of affiliates ..............................................................
Gain on disposal/sales of property and equipment, net .........................
Interest expenses ...................................................................................
Other, net ...........................................................................................
Income before income taxes ....................................................................
Income taxes:
Current ................................................................................................
Deferred ...............................................................................................
Net income ...............................................................................................
Net income attributable to non-controlling interests .............................
Net income attributable to owners of the parent ....................................
Net income attributable to non-controlling interests .............................
Net income ...............................................................................................
Other comprehensive income
Valuation difference on other securities ................................................
Remeasurements of defined benefit plans .............................................
Share of other comprehensive income of associates accounted
for using equity method ....................................................................
Total other comprehensive income ......................................................
Total comprehensive income ...................................................................
Total comprehensive income attributable to:
Owners of the parent ......................................................................
Non-controlling interests ................................................................
The accompanying Notes are an integral part of these statements.

6

Unaudited Consolidated Statements of Cash FlowsTONAMI HOLDINGS CO., LTD. AND CONSOLIDATED SUBSIDIARIESFor the six months ended September 30, 2018 and 2017

2017

Thousands of
U.S. dollars(Note 1)2018

¥3,637
2,498
(26)
(0)
14
—
24
(33)
80
(1)
3
95
(193)
109
169
(286)
(581)
(164)
49
5,394
193
(109)
(893)
4,585

¥2,963
2,472
(41)
3
32
0
100
(67)
(16)
14
(14)
22
(206)
114
(149)
(104)
(698)
(17)
298
4,706
206
(114)
(1,211)
3,587$32,030
21,996
(236)
(0)
125
—
218
(291)
711
(13)
29
838
(1,705)964
1,495(2,525)(5,124)(1,445)435
47,502
1,705(961)(7,871)40,375

Cash flows from investing activities:
Purchase of time deposits ...................................................................................
Proceeds from redemption of time deposits ........................................................
Purchase of property and equipment ..................................................................
Proceeds from sales of property and equipment ..................................................
Purchase of investments in securities ...................................................................
Proceeds from sales of investments in securities....................................................
Payment for purchase of investments in consolidated subsidiaries .......................
Investments in loans receivable ............................................................................
Proceeds from collection of loans receivable ........................................................
Other, net ...........................................................................................................
Net cash used in investing activities ...........................................................

(19)
22(1,229)
74
(41)
0
(409)
(351)
276
(36)
(1,714)(16)
22(1,782)
100
(11)
15
(198)
(299)
239
(23)
(1,953)(169)
194(10,825)
657
(368)
0
(3,607)(3,091)
2,438(321)(15,093)

Cash flows from financing activities:
Net decrease in short-term loans .........................................................................
Proceeds from long-term debt .............................................................................
Repayment of long-term debt .............................................................................
Repayments of lease obligations ..........................................................................
Purchase of treasury stock ...................................................................................
Dividends paid ...................................................................................................
Dividends paid to non-controlling interests ........................................................
Net cash used in financing activities ...........................................................

—
—
(355)
(1,420)
(5)
(362)
(3)
(2,146)750(427)(1,549)
(4)
(362)
(2)
(2,289)——(3,132)(12,507)(45)(3,194)(27)(18,904)

Net increase (decrease) in cash and cash equivalents .............................................
Cash and cash equivalents at beginning of period .................................................
Cash and cash equivalents at end of period (Note 5) ............................................

724
17,262¥17,986(655)
15,571¥14,915

6,378
151,996$158,375

Cash flows from operating activities:
Income before income taxes ................................................................................
Depreciation and amortization ...........................................................................
Gain on disposal/sales of property and equipment, net........................................
Loss on sales of investments in securities..............................................................
Loss on devaluation of investments in securities ..................................................
Loss on devaluation of golf club memberships.....................................................
Amortization of goodwill ....................................................................................
Equity in earnings of unconsolidated subsidiaries and affiliates ...........................
Decrease in allowance for doubtful accounts .......................................................
Increase (decrease) in net defined benefit liability ...................................................
Decrease in directors’ and corporate auditors’ retirement benefits .......................
Increase in accrued bonuses to employees ...........................................................
Interest and dividend income .............................................................................
Interest expenses .................................................................................................
Decrease in trade receivables ...............................................................................
Increase in inventories ........................................................................................
Decrease in accounts payable ..............................................................................
(Decrease) increase in accrued consumption taxes ...............................................
Other, net ...........................................................................................................
Subtotal ........................................................................................................
Interest and dividends received ...........................................................................
Interest paid ........................................................................................................
Income taxes paid ...............................................................................................
Net cash provided by operating activities ...................................................

The accompanying Notes are an integral part of these statements.

7

Millions of yen
2018Notes to the Unaudited Consolidated Financial Statements
TONAMI HOLDINGS CO., LTD. AND CONSOLIDATED SUBSIDIARIES

1.

Basis of presenting financial statements

The accompanying consolidated financial statements have been prepared based on the accounts maintained by Tonami Holdings Co., Ltd. (the“Company”) and consolidated subsidiaries in accordance with accounting principles generally accepted in Japan, which differ in certain respects as
to the application and disclosure requirements of International Financial Reporting Standards.
In preparing these consolidated financial statements, certain reclassifications and rearrangements have been made to the Company’s
consolidated financial statements issued domestically in order to present them in a format which is more familiar to readers outside Japan.
The consolidated financial statements are stated in Japanese yen, the currency of the country in which the Company is incorporated andoperates. The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers outside Japan andhave been made at the rate of ¥113.57 to U.S.$1, the approximate rate of exchange at September 29, 2018. Such translations should not be
construed as representations that the Japanese yen amounts could be converted into U.S. dollars at that or any other rate.
(Additional Information)(Application of “Partial Amendments to Accounting Standard for Tax Effect Accounting, etc.” and other standards)
Effective from the beginning of the first quarter of the fiscal year ending March 31, 2019, the Company has applied “Partial Amendments to
Accounting Standard for Tax Effect Accounting, etc.” (ASBJ Statement No. 28, February 16, 2018) and other standards, and accordingly deferred
tax assets are presented under investments and other assets and deferred tax liabilities are presented under long-term liabilities.

2.

Inventories

3.

Notes due at the end of the fiscal year

Inventories as of September 30, 2018 consisted of merchandise of ¥475 million ($4,189 thousand), raw materials and supplies of ¥255 million($2,248 thousand), and work in process of ¥111 million ($977 thousand).

Notes due at the end of the fiscal year are treated as if they were settled on the due date.
Since the last day of the first six-month period, September 30, 2018, was a holiday for financial institutions, the following notes due at theend of the first six-month period were treated as if they were settled on the due date.
Trade notes receivable ......................................................................................................

Millions of yen¥282

Thousands of
U.S. dollars$2,488Trade notes payable .........................................................................................................

¥168$1,487

4.

Major expenses included in selling, general and administrative expenses and their amounts

Major expenses included in selling, general and administrative expenses and their amounts are as follows.

Bonuses to employees ......................................................................................................
Provision for bonuses ......................................................................................................
Retirement benefit costs ..................................................................................................
Provision for retirement benefits for directors and corporate auditors ..............................

5.

Millions of yen
September 30,
September 30,
2018
2017
¥1,169¥1,239
¥146
¥145
¥53
¥55
¥14
¥13

Thousands of
U.S. dollars
September 30,
2018$10,300$1,287$471$125

Cash flow statements

Reconciliation of cash and time deposits shown in the consolidated balance sheets, and cash and cash equivalents shown in the consolidated
statements of cash flows as at September 30, 2018 and 2017 are as follows:

Cash and time deposits ....................................................................................................
Time deposits with maturities exceeding three months ....................................................
Cash and cash equivalents ...............................................................................................

8

Millions of yen
September 30,
September 30,
2018
2017
¥18,011¥14,930(24)(15)¥17,986¥14,915

Thousands of
U.S. dollars
September 30,
2018$158,591(217)$158,375

6.

Amounts per share
Net income per share
Yen

Basic ................................................................................................................................
Diluted ............................................................................................................................
Cash dividends ................................................................................................................

Six months
ended
September 30,
2018¥253.49—
40.00

Six months
ended
September 30,
2017¥202.37—
4.00

U.S. dollars
Six months
ended
September 30,
2018$2.2320—0.3522Basis for the calculation of net income per share for the six months ended September 30, 2018 and 2017 was as follows:—

Net income per share:
Net income ...............................................................................................................
Net income not available to shareholders of common stock ......................................
Net income available to shareholders of common stock .............................................
Weighted-average number of shares of common stock outstanding (shares) ..............

Millions of yen
Six months
Six months
ended
ended
September 30,
September 30,
2018
2017
¥2,297—2,297
9,065,276¥1,835—
1,835
9,068,516

Thousands of
U.S. dollars
Six months
ended
September 30,
2018$20,233—
20,233

Diluted net income per share is not presented for the six months ended September 30, 2018 and 2017 since there were no outstanding
potentially dilutive securities.
(Note)The Company conducted a 1-for-10 reverse stock split of its shares of common stock effective October 1, 2017.
Accordingly, net income per share was calculated under the assumption that the said reverse stock split had been conducted on April 1, 2017 (atthe beginning of the fiscal year ended March 31, 2018).

7.

Subsequent events

At a meeting held on November 9, 2018, the board of directors of the Company resolved the following interim cash dividends:
Cash dividends (¥40.00 per share) ..................................................................................

9

Millions of yen¥362

Thousands of
U.S. dollars$3,193

8.

Segment information

Information on operating revenues and income/loss by reportable segment(a) For the six months ended September 30, 2017
Millions of yen

Operating revenues:
1. Revenues from outside customers .....................................
2. Intersegment revenues or transfers ....................................
Total ...............................................................................
Segment income ..........................................................................

Logistics

Reportable segment
Information
processing
Sales¥59,352
959,361¥2,414¥1,286
119
1,406
¥122

¥2,540
1,941
4,482
¥72

Total
¥63,179
2,070
65,250¥2,609

Others
*1
¥798
121
920
¥59

Total
¥63,978
2,192
66,170¥2,668

Adjustment Consolidated
*2
*3
¥ —
(2,192)(2,192)¥(7)¥63,978—
63,978¥2,660(b) For the six months ended September 30, 2018
Millions of yen

Operating revenues:
1. Revenues from outside customers .....................................
2. Intersegment revenues or transfers ....................................
Total ...............................................................................
Segment income ..........................................................................

Logistics

Reportable segment
Information
processing
Sales¥62,11712
62,130¥3,224¥1,318
121
1,440
¥169

¥3,052
2,151
5,203
¥61

Total
¥66,488
2,285
68,774¥3,456

Others
*1
¥881
71
952
¥72

Total
¥67,3692,356
69,726¥3,529

Adjustment Consolidated
*2
*3
¥—
(2,356)(2,356)¥(24)¥67,369—
67,369¥3,505

Thousands of U.S. dollars

Operating revenues:
1. Revenues from outside customers .....................................
2. Intersegment revenues or transfers ....................................
Total ...............................................................................
Segment income ..........................................................................

Logistics

Reportable segment
Information
processing
Sales$546,955
114
547,069$28,396$11,611
1,070
12,681$1,496$26,875
18,94345,817
$545

Total

Others*1

Total$585,441
20,127605,568$30,437$7,759
625
8,384
$641

$593,199
20,752
613,952$31,078

Adjustment Consolidated
*2
*3
$—
(20,752)(20,752)$(215)$593,199—
593,199$30,863*1 “Others” corresponds to operating segments that are not included in the reported operating segments and includes automobile repair service
and other operations.
*2 Adjustments are as follows
Adjustments of segment income
For the six months ended September 30, 2018 and 2017, adjustments of segment income amounted to ¥(24) million ($(215) thousand)and ¥(7) million, respectively. Adjustments include intersegment eliminations and corporate expenses not allocated to any reportablesegments.
For the six months ended September 30, 2018 and 2017, the above-mentioned intersegment eliminations amounted to ¥407 million($3,591 thousand) and ¥404 million, respectively, and corporate expenses not allocated to any reportable segments amounted to ¥(432)million ($(3,806) thousand) and ¥(411) million, respectively. Corporate expenses are mainly expenses of the Company’s operations that do
not belong to any reportable segments.
*3 Segment income is adjusted to operating income in the consolidated financial statements.

10Consolidated Subsidiaries

Logistics
Company NameBusiness Line

Tonami Transportation Co., Ltd.

Road haulage

Tonami Transportation Shinetsu Co., Ltd.

Road haulage

Tonami Transportation Chugoku Co., Ltd.

Road haulage

Kanto Tonami Transportation Co., Ltd.

Road haulage

Hokuriku Tonami Transportation Co., Ltd.

Road haulage

Tonami Shutoken Logistics Co., Ltd.

Road haulage

Tonami Kinki Logistics Co., Ltd.

Road haulage

Ishikawa Tonami Transportation Co., Ltd.

Road haulage

Tonami Daiichi Warehouse Logistics Co., Ltd.

Road haulage / Warehousing

Fukui Tonami Transportation Co., Ltd.

Road haulage

Niigata Tonami Transportation Co., Ltd.

Road haulage

Anan Transportation Co., Ltd.

Road haulage

Tonami Global Logistics Co., Ltd.

Harbor transport service

Keishin Warehouse Co., Ltd.

Warehousing

Kitakanto Tonami Transportation Co., Ltd.

Road haulage

Take One Co., Ltd.

Road haulage

Hatsutsuru Reizo Co., Ltd.

Warehousing

KYK Co., Ltd.

Road haulage

Information Processing and Others
Company NameBusiness Line

Tonami Trading Co., Ltd.

Trading Company

Toyo Gomu Hokuriku Hanbai Co., Ltd.

Sale of tires

KSR Co., Ltd.

Development and sale of software

Chuo Reizo Co., Ltd.

Other

Tonami Automobile Technology Research Institute Co., Ltd.

Automobile technology R&D

Tonami Business Service Co., Ltd.

Financial service

11

Board of Directors and Corporate
Auditors

Corporate Data

President and Representative Director

Head Office

Katsusuke Watanuki

2-12, Showa-machi 3-chome, Takaoka,
Toyama Prefecture 933-8788, Japan
Phone: +81-766-32-1073
Fax: +81-766-32-1077

Senior Managing Directors
Kazuo Takata
Shinichi Izumi

Tokyo Office8-4, Nihonbashihoridome-cho 2-chome, Chuo-ku,
Tokyo 103-0012, Japan
Phone: +81-3-3664-5403
Fax: +81-3-3664-5405

Directors
Yasuo Terabayashi
Toyonobu Terahai
Yasuhiro Saegusa
Mitsuharu Wadachi
Shinichiro Inushima
Ichiro Tanaka

Date of Establishment
June 1943

Common Stock¥14,182 million

Standing Corporate Auditors

Issued and Outstanding Shares

Mitsuo Matsuda
Masafumi Takebe

9,761,011 shares(As of September 30, 2018)

Corporate Auditors
Yohji Ishiguro
Atsuki Matsumura(As of September 30, 2018)12

TONAMI HOLDINGS CO., LTD.
URL:http://www.tonamiholdings.co.jp/