Briefing on Consolidated Financial

Results for the Third Quarter
Ended December 31, 2018
PERSOL HOLDINGS CO., LTD.
14 Feb 2019

Copyright © PERSOL HOLDINGS

CO., LTD. All Rights Reserved.

FY Mar 2019: 3Q Summary of Consolidated Results
Sales grew +38.4% due to stable growth amongst existing businesses and M&A contribution, andachieved a new record for sales in a 3Q period.
The core temporary staffing and placement businesses led the way, and profit grew substantially.
(Unit:JPY million)
FY Mar 2018
3Q
Cumulative

FY Mar 2019 Forecast Results

FY Mar 2019

Ratio (%)

3Q
Cumulative

Ratio (%)

Growth rate(%)

Full Year

Progress (%)

Sales

495,085100.0

685,231

100.0

+38.4

940,000

72.9

Gross profit

118,32323.9

151,252

22.1

+27.8

-

-

EBITDA*

33,6486.8

43,7306.4+30.0

56,50077.4

Operating Profit

25,8995.2

32,0744.7+23.8

42,50075.5

Net Profit
Attributable to
Owners of
Parent10,872

2.2

18,7382.7+72.3

21,80086.0*Figures are rounded dow n (as w ith follow ing pages)*EBITDA = Operating Profit + Depreciation + Amortization of Goodw ill (as w ith follow ing pages)
Copyright © PERSOL HOLDINGS

CO., LTD. All Rights Reserved.

1

FY Mar 2019: 3Q Sales Analysis
Organic growth of existing business was +8.3% together with the PROGRAMMED M&A
contribution resulted in sales growth of +38.4%.

(Unit: JPY 100 million)△20+1,513

+95

+70

-

+28

＋12

+10
6,852

+191

4,950

FY Mar 2018
3Q cumulative
results

M&A*
Effect+1,513

Organic growth*+409

Temporary
Staffing/BPO
Segment

Recruiting
Segment

PROGRAMMED
Segment

PERSOLKELLY
Segment

ITO
Segment

Engineering
Segment

Other

M&A effect(PROGRAMMED)

Adjustments

FY Mar 2019
3Q cumulative
results*M&A target companies (figures in brackets indicate date (YY/MM) that contribution to consolidated results commenced):Programmed Maintenance Services Limited (Jan 2018).
*M&A effect : Indicates the net increase of funds due to M&As (Values are prior to eliminations of internal transactions).
*Organic growth (or existing businesses) : Indicates amounts of increase that exclude the net increase of funds due to M&As (F igures are prior to elimination of internal transactions)
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Business Process Outsourcing (BPO), IT Outsourcing (ITO) (identical with following pages)

2

FY Mar 2019: 3Q Sales by Segment
Demand continued to be robust, and sales grew in each segment.
(Unit:JPY million)

FY Mar 2018

FY Mar 2019 Results Forecast

FY Mar 2019

3Q Cumulative

3Q Cumulative

Growth (%)

Full Year

Progress (%)

Temp/BPO

359,263

378,435+5.3

520,000

72.8

Recruiting

52,736

62,249+18.0

84,00074.1

PROGRAMMED*-

151,331-215,000

70.4

PERSOLKELLY

48,45255,495+14.5

68,00081.6

ITO

21,00423,869+13.6

33,00072.3

Engineering

20,154

21,371+6.0

30,000

71.2

Other

3,123

4,219

+35.1

5,000

84.4

Adjustments△9,648△11,739-△15,000-

TOTAL

495,085

685,231+38.4

940,000

72.9*PROGRAMMED Segment: The financial closing date of PROGRAMMED LTD. differs with PERSOL by 3 months. The Deemed Acquisition Dat e for Business Combinations is set as 30 September 2017and as such, PROGRAMMED LTD's contribution to the results commences from January 2018.
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Figures are prior to elimination of internal transactions

3

FY Mar 2019: 3Q EBITDA Analysis
Organic growth of existing business was +15.3% together with the PROGRAMMED M&A
contribution resulted in EBITDA growth of +30.0％.

(Unit: JPY 100 million)

△5
+54
+4

-

△4

+3

△0

+34
+14

437

336

FY Mar 2018
3Q cumulative
results

M&A*
Effect+54

Organic growth*+51

Temporary
Staffing/BPO
Segment

Recruiting
Segment

PROGRAMMED
Segment

PERSOLKELLY
Segment

ITO
Segment

Engineering
Segment

Other

M&A effect(PROGRAMMED)

Adjustments

FY Mar 2019
3Q cumulative
results*M&A target companies (figures in brackets indicate date (YY/MM) that contribution to consolidated results commenced):Programmed Maintenance Services Limited (Jan 2018). Acquisition costs ofProgrammed (0.8 billion) was booked at FY 2018 3Q.
*M&A effect : Indicates the net increase of funds due to M&As (Values are prior to eliminations of internal transactions).
*Organic growth (or existing businesses) : Indicates amounts of increase that exclude the net increase of funds due to M&As (F igures are prior to elimination of internal transactions)
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Business Process Outsourcing (BPO), IT Outsourcing (ITO) (identical with following pages)

4

FY Mar 2019: 3Q EBITDA by Segment
Drivers of organic growth were the Temporary Staffing/BPO and Recruiting segments.
(Unit:JPY million)

FY Mar 2018

FY Mar 2019 Results Forecast

FY Mar 2019

3Q Cumulative

3Q Cumulative

Growth (%)

Full Year

Progress (%)

Temp/BPO

19,433

20,850+7.3

27,70075.3

Recruiting

9,454

12,860+36.0

16,90076.1

PROGRAMMED*

△804

4,660

-

6,500

71.7

PERSOLKELLY

794

1,199

+51.0

1,200

100.0

ITO

1,831

1,430

△21.9

2,100

68.1

Engineering

1,910

2,266

+18.7

3,100

73.1

Other

△89

△116

△30.7

△200

-

Adjustments

1,118

577

-

△800

-

TOTAL

33,64843,730+30.056,50077.4*PROGRAMMED Segment: The financial closing date of PROGRAMMED LTD. differs with PERSOL by 3 months. The Deemed Acquisition Dat e for Business Combinations is set as 30 September 2017and as such, PROGRAMMED LTD's contribution to the results commences from January 2018. Acquisition costs of Programmed (0.8 billion) was booked at FY 2018 3Q.
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Figures are prior to elimination of internal transactions

5

FY Mar 2019: 3Q Operating Profit Analysis
Organic growth of existing business was +22.4% together with the PROGRAMMED M&A
contribution resulted in operating profit growth of +23.8%.
(Unit: JPY 100 million)
△6

△4
+9

-

+3

△00

+10

+38

320

+11

258

FY Mar 2018
3Q cumulative
results

M&A*
Effect+10

Organic growth*+57

Temporary
Staffing/BPO
Segment

Recruiting
Segment

PROGRA MMED
Segment

PERSOLKELLY
Segment

ITO
Segment

Engineering
Segment

Other

M&A effect
Adjustments(PROGRA MMED)FY Mar 2019
3Q cumulative
results*M&A target companies (figures in brackets indicate date (YY/MM) that contribution to consolidated results commenced):Programmed Maintenance Services Limited (Jan 2018). Acquisition costs ofProgrammed (0.8 billion) was booked at FY 2018 3Q.
*M&A effect : Indicates the net increase of funds due to M&As (Values are prior to eliminations of internal transactions).
*Organic growth (or existing businesses) : Indicates amounts of increase that exclude the net increase of funds due to M&As (F igures are prior to elimination of internal transactions)
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Business Process Outsourcing (BPO), IT Outsourcing (ITO) (identical with following pages)

6

FY Mar 2019: 3Q Operating Profit by Segment
Drivers of organic growth were the Temporary Staffing/BPO and Recruiting segments.
(Unit:JPY million)
FY Mar 2018

FY Mar 2019 Results Forecast

FY Mar 2019

3Q Cumulative

3Q Cumulative

Growth (%)

Full Year

Progress (%)

Temp/BPO

16,90818,015+6.5

23,90075.4

Recruiting

6,890

10,770+56.3

14,30075.3

PROGRAMMED*

△804

237

-

1,100

21.6

PERSOLKELLY

△314

647

+305.9

700

92.5

ITO

1,335

844

△36.7

1,500

56.3

Engineering

1,451

1,816

+25.1

2,700

67.3

Other

△139

△175

△25.9

△250

-

572

△83

-

△1,450-25,89932,074+23.8

42,50075.5

Adjustments
TOTAL*PROGRAMMED Segment: The financial closing date of PROGRAMMED LTD. differs with PERSOL by 3 months. The Deemed Acquisition Dat e for Business Combinations is set as 30 September 2017and as such, PROGRAMMED LTD's contribution to the results commences from January 2018. Acquisition costs of Programmed (0.8 billion) was booked at FY 2018 3Q.
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Figures are prior to elimination of internal transactions

7

FY Mar 2019: 3Q Consolidated Balance Sheet
End of FY Mar 2018

(Unit:JPY million)

Results

End of 3Q FY Mar 2019

Ratio (%)

Results

Ratio (%)

Increase/
Decrease

402,336100.0

365,083

100.0△37,252

230,55257.3

205,31056.2△25,241

89,62422.3

73,53720.1△16,087

171,78342.7

159,77343.8△12,010113,26528.2

102,34828.0△10,917242,34360.2

197,04254.0△45,301

Current Liabilities

217,10254.0

132,487

36.3△84,614(Loans payable w ithin one year)

89,92822.4

20,2695.6△69,659

Non-Current Liabilities

25,241

6.3

64,55417.7

39,313(Long-term loans payable)

15,713

3.9

35,7139.8

20,000(Bonds)0

0.0

20,0005.5

20,000159,99239.8

168,041

46.0

8,048

145,53736.2

153,140

41.9

7,602

(Capital stock)

17,467

4.3

17,4794.8

12(Capital surplus)

20,182

5.0

20,396

5.6

213(Retained earnings)

105,99326.3

120,05432.9

14,061

14,455

3.6

14,901

4.1

446

AssetsCurrent Assets(Cash and deposits)

Non-current Assets(Trademark rights/goodw ill)
Liabilities

Net assets
Equity capital

Non-controlling interests*Partial revision of “Accounting standards pertaining to Tax Effective Accounting” have been applied since 1Q in FY2019.
Results were re-released after the results at the end of the previous FY were recalculated.

Trademark rights/goodwill
Decreases due to amortization/forex
rates
Current assets/Current liabilities/
Non-current liabilities
Repayment of short-term loans
partially by cash, and refinancing thebalance by long-term loans andcorporate bonds. (long-term
conversion)

Retained earnings
Increases due to increased profit

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FY Mar 2019: 3Q Business Results Trends by Segment: ① Temporary Staffing/BPO Segment
FY Mar 2019: 3Q Highlights+5.3%(Unit:JPY 100 million)• Workstyle-reform, and chronic labor shortages as a
backdrop see temporary labor demand at high levels.

+6.5%• Growth in revenues due to the impact of revisions toJapan's labor laws acting to strengthen demand.

+7.3%

3,592

3,784
208
194

Sales

169

EBITDA• Costs associated with merging subsidiaries increased,
however, direct hiring by clients in response to revisions toJapan's labor laws resulted in growth in placement fee
revenues, and also higher billing rates.

180

Operating Profit(Unit:JPY million)

FY Mar 2018

FY Mar 2019

3Q Cumulative

3Q Cumulative

FY Mar 2019 Forecast Results
Growth (%)

Full Year

Progress (%)

Sales

359,263

378,435+5.3

520,000

72.8

EBITDA

19,433

20,850+7.3

27,700

75.3

5.4

5.5

-

5.3

-

16,90818,015+6.5

23,900

75.4

4.7

4.8

-

4.6

-

EBITDA Margin (％)
Operating Profit
Operating profit ratio (％)*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3rd Quarter FY March 2019" released on the PERSOL w ebsite on the same date as the quarterly results. Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.

9

FY Mar 2019: 3Q Business Results Trends by Segment：② Recruiting Segment
FY Mar 2019: 3Q Highlights+18.0%(Unit:JPY 100 million)• Demand from client companies continued to be robust, with theplacement business driving the results.

+36.0%• Proactive investments were made into advertising, andheadcount had to be bolstered in response to healthy demand
resulting in substantial profit growth. (Of special note: in October
2018, the Career change service "DODA" was re-branded as"doda".)+56.3%

622
128

527
94

107

• A decline in goodwill amortization also contributed to profitability
improvements due to the booking of the amortization impairment
in the "an" business during the previous FY 2018 4Q period.

68
Sales

EBITDA

Operating Profit(Unit:JPY million)
FY Mar 2018
3Q Cumulative

FY Mar 2019
3Q Cumulative

FY Mar 2019 Results Forecast
Growth (%)

Full Year

Progress (%)

Sales

52,736

62,249+18.0

84,00074.1

EBITDA

9,454

12,860+36.0

16,90076.1

EBITDA Margin (％)

17.9

20.7

-

20.1

-

Operating Profit

6,890

10,770+56.3

14,30075.3

Operating profit ratio (％)

13.1

17.3

-

17.0

-

*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3rd Quarter FY March 2019" released on the PERSOL w ebsite on the same date as the quarterly r esults. Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.

10

FY Mar 2019: 3Q Business Results Trends by Segment:③ PROGRAMMED Segment
FY Mar 2019: 3Q Highlights(Unit:JPY 100 million)

Staffing Business:• Aggressive pricing by some competitors had an impact and eventhough sales declined, there was only a slight reduction in profit due
to offsetting reductions in sales and general administrative (SGA)
expenses.

1,513

Maintenance Business:• For facility maintenance of public institutions, despite the sales
declined due to the decrease of orders from major customers, profits
are steady due to new orders of university related facilities projects

46
△8
Sales

△8

EBITDA

2•

Operating Profit

Meanwhile, maintenance of mining facilities has declined inoperating rate as orders from existing customers declined, bothsales and profits declined(Unit:JPY million)
FY Mar 2018

FY Mar 2019

3Q Cumulative

Sales
EBITDAEBITDA Margin (％)
Operating Profit
Operating profit ratio (％)

3Q Cumulative

FY Mar 2019 Results Forecast
Growth (%)

Full Year

Progress (%)-

151,331-215,000

70.4

△804

4,660

-

6,500

71.7

-

3.1

-

3.0

-

△804

237

-

1,100

21.6

-

0.2

-

0.5

-

*Share acquisition related costs (0.8 billion) in 3Q of FY 2018 were booked.
*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3 rd Quarter FY March 2019" released on the PERSOL website on the same date as the quarterly results.

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11

FY Mar 2019: 3Q Business Results Trends by Segment:④ PERSOLKELLY Segment
FY Mar 2019: 3Q Highlights+14.5%(Unit:JPY 100 million)• Sales were healthy due to a backdrop of continued favorable market
conditions in APAC countries. Operating profit successfully returned tothe black with the placement business driving results.

+51.0%
554• Proactive investments were made that targeted productivity
improvements: proactive strengthening of deployments of personnel
needed to handle the healthy demand, as well as implementation of acommon systems in branches etc.

+305.9%484

11
7• Results for Capita recovered after an impairment loss was booked in
the previous 3Q period, and the results from key countries continued tobe healthy.

6
△3

Sales

EBITDA

Operating Profit(Unit:JPY million)

FY Mar 2018

FY Mar 2019

3Q Cumulative

3Q Cumulative

FY Mar 2019 Results Forecast
Growth (%)

Full Year

Progress (%)

48,45255,495+14.5

68,00081.6

EBITDA

794

1,199

+51.0

1,200

100.0

EBITDA Margin (％)

1.6

2.20

-

1.8

-

Operating Profit

△314

647

+305.9700

92.5

Operating profit ratio (％)

△0.6

1.2

-

1.0

-

Sales

*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3rd Quarter FY March 2019" released on the PERSOL w ebsite on the same date as the quarterly results.

Copyright © PERSOL HOLDINGS

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12

FY Mar 2019: 3Q Business Results Trends by Segment: ⑤ ITO Segment+13.6%FY Mar 2019: 3Q Highlights(Unit:JPY 100 million)• Intention to invest (IT system related services etc.) remainedsolid among existing corporate clients.
• High value-added opportunities continuously lead the whole
results (e.g. SI-related services, and outsourcing services etc.).

△21.9%

238• Costs increased due to better treatment of workers, and eventhough there was a decline in profitability compared to theprevious year, this trend was already factored into plans. In
addition, the turnover rate tends to decline due toimprovements to labor conditions.

210
18△36.7%

14
13

Sales

EBITDA

8

Operating Profit(Unit:JPY million)

FY Mar 2018

FY Mar 2019

3Q Cumulative

3Q Cumulative

FY Mar 2019 Results Forecast
Growth (%)

Full Year

Progress (%)

Sales

21,00423,869+13.6

33,00072.3

EBITDA

1,831

1,430

△21.9

2,100

68.1

8.7

6.0

-

6.4

-

1,335

844

△36.7

1,500

56.3

6.4

3.5

-

4.5

-

EBITDA Margin (％)
Operating Profit
Operating profit ratio (％)*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3rd Quarter FY March 2019" released on the PERSOL w ebsite on the same date as the quarterly results. Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.

13

FY Mar 2019: 3Q Business Results Trends by Segment ⑥ Engineering Segment
FY Mar 2019: 3Q Highlights+6.0%(Unit:JPY 100 million)• Demand was weak for some household electronics, but
R&D demand was strong in automobiles, and construction
equipment etc.

• Margin improved due to solid orders and the increase ofhigher unit price deals+18.7%

213
201+25.1%
19
Sales• Talent was actively recruited and momentum maintained inrelation to partner activity to secure the scale of thebusiness.

22
14

EBITDA18

Operating Profit(Unit:JPY million)

FY Mar 2018

FY Mar 2019

3Q Cumulative

3Q Cumulative

FY Mar 2019 Results Forecast
Growth (%)

Full Year

Progress (%)

Sales

20,154

21,371+6.0

30,00071.2

EBITDA

1,910

2,266

+18.7

3,100

73.1

9.5

10.6

-

10.3

-

1,451

1,816

+25.1

2,700

67.3

7.2

8.5

-

9.0

-

EBITDA Margin (％)
Operating Profit
Operating profit ratio (％)*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3rd Quarter FY March 2019" released on the PERSOL w ebsite on the same date as the quarterly results. Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.

14

FY Mar 2019: 3Q Business Results Trends by Segment: ⑦ Other/Adjustments(Unit:JPY million)
FY Mar 2018

FY Mar 2019

FY Mar 2019 Results Forecast

Other
3Q Cumulative

3Q Cumulative

Growth (%)

Full Year

Progress (%)

Sales

3,123

4,219

+35.1

5,000

84.4

EBITDA

△89

△116

△30.7

△200

-

EBITDA Margin (％)

△2.9

△2.8

-

△4.0

-

Operating Profit

△139

△175

△25.9

△250

-

Operating profit ratio (％)

△4.5

△4.2

-

△5.0

(Unit:JPY million)

FY Mar 2018

FY Mar 2019

FY Mar 2019 Results Forecast

Adjustments
3Q Cumulative

3Q Cumulative

Growth (%)

Full Year

Progress (%)

Sales△9,648△11,739-△15,000-

EBITDA

1,118

577

-

△800

-

-

-

-

-

-

572

△83

-

△1,450

-

-

-

-

-

-

EBITDA Margin (％)
Operating Profit
Operating profit ratio (％)*Figures are prior to elimination of internal transactions*Please refer to the "Factbook: 3rd Quarter FY March 2019" released on the PERSOL w ebsite on the same date as the quarterly results.
*Others include our group functional services, education and training business, employment support business for people w ith disabilities, and childcare business
Copyright © PERSOL HOLDINGS CO., LTD. All Rights Reserved.
*Adjustments stand for elimination of transactions between segments, and revenue and expenses of PERSOL HOLDINGS CO., LTD.

15

Acquisition of Avanti Staff Corporation shares (conversion into a subsidiary)
We aim to further enhance corporate value by utilizing a client base such as Fuyo Group and the know-how
of financial affairs and trade affairs cultivated by Avanti staff and the know-how relating to soliciting job
seekers by PERSOL group
Outline of share acquisition

Corporate Profile

Avanti Staff Corporation

Established in September 1984
Expand Temporary staffing business,placement/recruitment business,outsourcing business, training businesswithin domestic Japan.

Aims

Expand theclient base…

Enhancespecialization…

Expand the so-called'Fuyo Group' client base ofMizuho Banking Ltd. andMarubeni Corporation.

Strengthen handling knowhow in specialized roles suchas trade support and financeadministration .

Transaction Outline

Sales JPY 18,366 million, Operating profit
JPY 271 million (FY Mar 2018 results)
Share transfer data : 31 Jan 2019

Acquisition: 92.52% of fully issued shares
Begin to be reflected in results:
from 4Q of FY Mar 2019.
(Temporary Staffing/BPO Segment)

Leverageknow-how insoliciting job
seekers…
Focus on leveraging PERSOLGroup’s business platform &know-how in soliciting jobseekers.

*For further details, please refer to the timely release "Announcement regarding acquisition of Avanti Staff Corporation shar es (conversion into a subsidiary)" made on 21 Dec 2018.
Copyright © PERSOL HOLDINGS

CO., LTD. All Rights Reserved.

16

Appendix: Recent M&As
Company name

Programmed Maintenance Services Limited

Established

January 1992

Net sales (*1)

AUD 2,691 million （*1）

Operating profit (*1)

AUD 21 million （*1）

Acquisition date

October 2017

Contribution commenced beingreflected in results

4Q of FY Mar 2018

Ownership ratio

100%

Acquisition priceJPY 66,000 million（*2）

Goodwill

Goodwill amortization period
Affiliated segment

Staffing Business

Maintenance Business

JPY 21,030 million

JPY 31,540 million

10 years

20 years
PROGRAMMED*1. Figures refer to the results of PROGRAMMED Ltd. and its subsidiaries for the FY Mar 2017. Operating profit has been calculated after amortization of
goodwill calculated at the time of acquisition (tentative figures), and after amortization of intangible fixed assets (total AUD 56 million/year).
*2. Conversion rate used: AUD 1: JPY 88.15
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17

Attention: Note regarding handling of this material

Results forecasts etc. used in this material contain forward-looking
statements which are based on a certain number of assumptions PERSOL
deems rational, and the information at hand as of 14 February 2019 which are
not meant in any way by PERSOL to be taken as assurances that will be
realized. Actual results etc. may vary greatly due to various causes.

The figures, indicators, PERSOL Group results, and details of financial status
included in this material have been released to facilitate an appropriate
understanding. Kindly note that not all the figures and indicators have been
subjected to audit and review by external auditors.

August 2014: Selected as one stock forming the JPX-Nikkei 400 Index composition
What is the
JPX-Nikkei 400?

The JPX-Nikkei 400 index is a new share price index composed of corporations that aim to satisfy the various
requirements of global investment standards for the purpose of highlighting etc. in Japan and overseas theappeal of Japanese firms from a management view point of efficient application of capital and investor
aw areness etc.

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18