【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results for the 2nd Quarter of the Fiscal YearEnding March 2018 (Based on Japanese GAAP)
November 13, 2017
Listed company

PERSOL HOLDINGS CO., LTD.

name
Stock code:
Representative
Inquiries

Stock Exchange Listing: Tokyo

2181

URL http://www.persol-group.co.jp

Current

President, Representative

Position

Director and CEO

Current

Director, Executive Officer (Chief

Position

Financial Officer)

Scheduled date to file

Masamichi Mizuta
Kiyoshi Seki
Scheduled date to commence

November 14, 2017

quarterly report:

TEL +81 03-3375-2220

dividend payments:

Preparation of supplementary quarterly results explanatory material yes/no:

Yes

Quarterly results briefing session yes/no:yes

December 5, 2017

(Analyst/Institutional investor oriented)(Amounts less than JPY 1 million rounded down)nd

1. Consolidated Results for the 2 Quarter of the Fiscal Year Ending March 2018 (April 1, 2017 - September 30, 2017)(1) Consolidated operating results (cumulative)(% indicates ratio of change from same quarter last year)
Sales

Quarterly net profit
attributable to parent
company shareholders

Ordinary profit

JPY Million%

JPY Million%

JPY Million%

JPY Million%

324,780

17.3

16,017-3.9

16,668

-1.6

9,223

-6.5

276,790

12.5

16,66025.3

16,945

26.9

9,865

21.7

2 quarter of fiscal
year ended March
2017

8,974

2nd quarter of fiscal year
ending March 2018
2nd quarter of fiscal year
ended March 2017
Note:
Comprehensive
incomeOperating profitnd

2 quarter offiscal year ending
March 2018

nd

JPY
Million

10,548(17.5%)

JPY
Million(9.8%)

Quarterly net profit per share after
adjustment for dilution
Quarterly net profit

Current period net profit per share
Quarterly net profit

JPY

JPY

2 quarter of fiscal year
ending March 2018

39.47

39.47

2nd quarter of fiscal year
ended March 2017

42.05

41.91

nd

(2) Consolidated financial position
Total assets

Total assets

Equity ratio

JPY Million

JPY Million%

276,438

160,91352.7

268,364

153,816

51.8

2nd quarter of fiscal year
ending March 2018
FY ended Mar 2017ndReference: Equity

2 quarter of fiscal year

capitalending March 2018

145,729JPY

FY endedMillionMar 2017

139,119

JPY
Million

2. Dividend Status
Annual Dividend

FY ended Mar 2017
FY ending Mar 2018

End Q1End Q2End Q3

JPY

JPY

JPY

End of FY
JPY

Total
JPY

－
－

8.00

－

9.00

17.00

－

9.00

18.00

9.00

FY ending Mar 2018 (Forecast)－1 －【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Note: Revision of most recently announced financial results forecast Yes/No: No

3. Consolidated Results for the 2Full Yearnd

Quarter of the Fiscal Year Ending March 2018 (April 1, 2017 - March 31, 2018)(% indicates ratio of change from same quarter last year)
Current period net
Current period
profit attributable toSales
Operating profit
Ordinary profit
net profit per
parent company
share
shareholders
JPY
JPY
JPY
JPY
%
%
%
%
JPY
MillionMillionMillionMillion677,300
14.4
36,0007.8
36,5006.9
22,20024.6
94.94

Note: Revision of most recently announced financial results forecast Yes/No: Yes※ Explanatory Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in a change in thescope of consolidation): No
New: - Ltd. (company name); Excluded: - Ltd. (company name)(2)

Application of special accounting treatment when preparing quarterly consolidated financial statements: No(3) Changes in accounting policies/changes in accounting estimates/restatement of prior period financial statements① Changes in accounting policies due to revisions to accounting standards etc.: No② Changes in accounting policies other than ①:No③ Changes in accounting estimates:
No④ Restatement of revised statements:
No(4) Number of fully issued shares (ordinary shares)① Number of fully issued shares at period

2Q of fiscal year endingend (including treasury stock)

March 2018

② Treasury stock at period end

236,677,955

Fiscal year ended
Shares2Q of fiscal year ending

3,407,840

Fiscal year ended
SharesMarch 2018

③ Average number of shares during theperiod (cumulative quarter)

Note:

236,673,651

SharesMar 2017
2,838,299

SharesMar 2017

2Q of fiscal year ending
March 2018

233,681,111

2Q of fiscal year
Shares234,607,754

Sharesended March 2017

Number of treasury stock at the end of period: Includes PHD shares held in the "Director Compensation BIP (Board
Incentive Plan) trust account", and the "Employee Stock Ownership Plan trust account" ("ESOP Trust") (2nd quarter of the
fiscal year ending March 2018: 590,872 shares). Furthermore, PHD shares held in the "Director Compensation BIP (Board
Incentive Plan) trust account", and the "Employee Stock Ownership Plan trust account" ("ESOP Trust") are included intreasury stock which are deducted when calculating the average number of shares held in the period.

※ The quarterly summary of financial results is not subject to a quarterly review※ Explanation of appropriate usage of financial results forecasts and other special explanatory notes
The financial results outlook etc. and forward looking statements noted in this material are based on certain
assumptions PHD deems rational and information currently at hand, which are not meant to be taken as an
assurance by PHD that outcomes will be realized. Furthermore, actual financial results etc. may vary greatly due tovarious factors.

－

2 －【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

○ Contents of Attachments
1. Qualitative information regarding the financial results for this quarter……………………………………………………………………………………
(1) Explanation regarding business performance……………………………………………………………………………………
(2) Explanation regarding the financial position……………………………………………………………………………………
(3) Explanation regarding future forecast information (Consolidated results forecast etc.)……………………………………………………………………………………
2. Quarterly consolidated financial statements & main explanatory notes……………………………………………………………………………………
(1) Quarterly consolidated balance sheet……………………………………………………………………………………
(2) Quarterly consolidated profit and loss statement & quarterly consolidated comprehensive income statement……………………………………………………………………………………
Quarterly consolidated profit and loss statement……………………………………………………………………………………
nd
Consolidated cumulative 2 quarter period……………………………………………………………………………………
Quarterly consolidated comprehensive income statement……………………………………………………………………………………
nd
Consolidated cumulative 2 quarter period……………………………………………………………………………………
(3) Consolidated quarterly cash-flow statement(4) Explanatory notes regarding quarterly consolidated financial statements…………………………………………………………………………
(Explanatory notes regarding ongoing concern assumptions…………………………………………………………………………
(Explanatory notes in the event of significant changes in the amount of shareholders’ equity)…………………………………………………………………………
(Application of special accounting treatment when preparing the quarterly consolidated financial
statements) …………………………………………………………………………
(Segment information etc.)

2
2
3
4
5
5
7

7

8
9
11
11
11
11
11
13

(Significant past events)－

3 －【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

1. Qualitative information regarding the financial results for this quarter(1) Explanation regarding business performancend
The direction of Japan's economy continued to be unclear during the consolidated cumulative 2 quarter
period due to changes in political conditions overseas, trends in financial policy, and rising geopolitical risk etc.
Under these circumstances, there was a transition to a moderate economic recovery due to the government's
economic and financial policies etc. which on the whole resulted in expansion of corporate earnings.
The employment situation: a condition close to full employment continued. The July - September 2017
effective ratio of job offers to job seekers (seasonally adjusted) averaged 1.52 which was the highest recordedlevel in 43 years and five months. The September 2017 overall unemployment rate stood at 2.8%. The
underlying backdrop to this type of market environment is a shortage of workers combined with a lot of demand.
The HR services related market overall shifted to an expansionary trend. PERSOL Group also experienced atransition into a bullish market stemming from overall client demand, and as a result, performance steadily
improved. The core temporary staffing segment business in particular shifted to high levels of temp worker
deployments and also, in the placement business there was a major increase in the number of successfully
placed candidates.
In light of this type of economic environment, PERSOL Group proceeded with measures to further enhancebrand recognition. The trading name was changed to "PERSOL HOLDINGS" (July 2017), and the trading namesof major core companies were altered to reflect this new "PERSOL" branding. PERSOL Group is acomprehensive group of human resource services companies that encompasses a diverse range of HR
solutions: the core temporary staffing business, placement/recruitment, part-time hiring support,
outsourcing/design and development in the IT/engineering space, and BPO etc. PERSOL GROUP strives
wholeheartedly to offer solutions that resolve labor/hiring challenges.
Moreover, as an initiative in the HR services market in the Asia Pacific region, in October 2017 PHD acquired
100% of the fully-issued shares of Programmed Maintenance Services Limited making it a wholly-owned
subsidiary. Programmed is engaged in HR services and maintenance businesses primarily in Australia. In future
the aim is to leverage Programmed`s solid business platform to strengthen PHD`s competitiveness as the largest
HR services company in the region.
nd

As a result of the above, sales during this consolidated cumulative 2 quarter period were JPY 324,780 million(up 17.3% year-on-year (YOY)), operating profit was JPY 16,017 million (down 3.9% YOY), ordinary profit was
JPY 16,668 million (down 1.6% YOY), and net income attributable to parent company shareholders was JPY
9,223 million (down 6.5% YOY).
Business results by segment (before inter-segment/company write-offs) are as follows.
As of April 1, 2017 (the current consolidated fiscal year under review), reporting segment categories havechanged. The following year-on-year comparisons are made after amending previous year figures in line with the
new segment categories.
① Temporary Staffing/BPO Segment
Sales in this segment during this consolidated cumulative 2ndquarter period amounted to JPY 235,489

million (up 9.8% year-on-year (YOY)), and operating profit was JPY 10,676 million (up 7.5% YOY).
nd
Employment related indicators during this consolidated cumulative 2 quarter period continued to hover athigh levels; a continuation from the previous consolidated fiscal year, and chronic labor shortages wereaccompanied by ongoing robust demand. Also, various types of supply-side measures required to address
demand challenges were taken successfully, and sales grew substantially to JPY 235,489 million. On the profit
side, there was an increase in labor costs together with an expansion in operations, as well as an increase in
PERSOL Group's share of the burden of social insurance costs etc. for temps and employees. However, there
was a large increase in sales, and JPY 10,676 million in operating profit was booked.
② Recruiting Segment
Sales in this segment amounted to JPY 35,335 million (up 10.4% YOY) during this consolidated cumulative
2 quarter period, and operating profit was JPY 4,705 million (down 0.7% YOY).
nd

Sales grew significantly during this consolidated cumulative 2
－ 4 －

nd

quarter period as a result of augmenting

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

human resources deployed in the sales structure to meet vigorous demand. On the profit side, operating profit
was JPY 4,705 million due to increased labor/promotional costs etc. together with an expansion in operations.
③ Overseas segment
Sales in this segment during this consolidated cumulative 2ndquarter period were JPY 31,792 million (up329.2% YOY), and operating loss was JPY 285 million (operating loss in the same period last year was JPY
422 million).
nd

Sales grew significantly during this consolidated cumulative 2 quarter period as a result of expanded
operations accompanying an expansion in the scope of the joint venture with Kelly Services, Inc. On the profit
side, as a result of progress in establishing systems aimed at medium-term growth, operating losses of JPY
285 million were booked.
④ ITO Segment
Sales in this segment amounted to JPY 13,532 million (up 5.3% YOY) during this consolidated cumulative
2 quarter period, and operating profit was JPY 483 million (down 29.8% YOY).
ndnd

Sales grew steadily during this consolidated cumulative 2 quarter period due to high levels of orders for
systems development related investments and SI related services from client firms, as well as PERSOL Groupin-house systems development transactions etc. On the profit side, labor condition improvement for retention
and recruitment of engineers as well as office expansion etc. resulted in operating profit of JPY 483 million.
⑤ Engineering Segment
Sales in this segment amounted to JPY 13,062 million (up 4.1% YOY) during this consolidated cumulative
2 quarter period, and operating profit was JPY 709 million (down 29.5% YOY).
ndnd

Sales grew steadily during this consolidated cumulative 2 quarter period due to continued strong demandfor human resources primarily in the electronics and automotive industries etc. On the profit side, cost increasein particular projects resulted in operating profit of JPY 709 million.
(2) Explanation of financial position① Assets, liabilities, and net asset
Total assets decreased by JPY8.074million compared with the end of the previous consolidated accounting
period. Current assets increased by JPY 8,785 million and fixed assets decreased by JPY 710 million. The main
factor behind the increase in current assets was that while cash and deposits increased by JPY 11,867 million,
notes and accounts receivable decreased by JPY 2,277 million. The main cause of the decrease in fixed assets
was that while goodwill amortization decreased by JPY 3,084 million, investment in securities increased by JPY
915 million, guarantee money paid increased by JPY 367 million, and other assets increased by JPY 1,154
million.
Liabilities increased by JPY 977 million compared to the end of the previous consolidated accounting period.
Current liabilities decreased by JPY 2,817 million and non-current liabilities decreased by JPY 1,839 million. The
main cause of the decrease in current liabilities was a decrease in other liabilities of JPY 2,567 million. The maincause of the decrease in non-current liabilities was an increase in Long-term loans payable of JPY 2,323 million.
Net assets increased by JPY 7,096 million compared to the end of the previous consolidated accounting
period. The main cause was an increase in retained earnings of JPY 7,119 million due to payment of JPY
2,104 million in surplus dividends and posting JPY 9,223 million in quarterly net profit attributable to parent
company shareholders etc.
Fiscal year ended Mar 2018nd
Consolidated cumulative 2 quarter
period(FY End Mar 2017)

Return on Assets (ROA)

3.6%

7.6%

Return on equity (ROE)

6.5%

13.4%

Ratio of operating income to sales

4.9%

5.6%

－

5 －

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Ratio of ordinary profit to sales

5.1%

5.8%

Current ratio

191.8%

188.0%

Fixed assets ratio

70.3%

74.1%

Equity ratio

52.7%

51.8%

Total assets

JPY 276,438 million

JPY 268,364 million

Equity capital

JPY 145,729 million

JPY 139,119 million

JPY 81,254 million

JPY 69,382 million

Cash and cash equivalents etc. atend of period② Cash flow
Cash and cash equivalents (hereinafter "capital") at end of this consolidated cumulative 2ndquarter period: Net

profit before tax was JPY 16,395 million. The major causes of the capital increase were: increases in operating
debt, and payment of corporate tax etc. Factors leading to capital reduction were spending related to acquisitionof intangible fixed assets etc. As a result, cash flow was JPY 81,254 million; an increase of JPY 16,045 millionndcompared to the end of the previous consolidated cumulative 2 quarter period.
Following is an outline of each cash flow status and causal factors that arose in the consolidated cumulative
2 quarter period.
nd(Cash flows from operating activities)
Capital acquired from operating activities was JPY 22,524 million (JPY 22,584 million was acquired the same
period previous year). This was mainly due to payment of JPY 7,377 million in corporate taxes. On the other
hand, net income before taxes was JPY 16,395 million, increase in operating debt was JPY 3,606 million,
goodwill amortization was JPY 3,171 million, depreciation costs were JPY 1,859 million, and corporate tax
refunds were JPY 1,540 million.
(Cash flows from investment activities)
Capital spent on investment activities was JPY 4,290 million (JPY 3,921 million was used during the same period
last year). This was mainly due to spending of JPY 2,429 million on acquisition of intangible fixed assets, JPY
1,175 million spent on acquisition of tangible fixed assets, and spending of JPY 587 million on guaranty money
deposits.
(Cash flows from financial activities)
Capital spent on financial activities was JPY 6,247 million (JPY 4,288 million was spent during the same period
last year). This was mainly due to spending of JPY 2,320 million to pay back long-term debts, JPY 2,104 million
in dividend payments,and outgoings of JPY 1,276 million to acquire own shares.
③ Business related and financial challenges that must be addressed
2

There were no new business and financial challenges requiring attention during this consolidated cumulative
quarter period.

nd(3) Explanation of future forecast information (consolidated results forecast etc.)ndCurrent consolidated cumulative 2 quarter period business results were in general largely as anticipated. For
this reason, the consolidated result forecast has not been changed since being released on May 15, 2017.

－6 －【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

2. Quarterly consolidated financial statements & main explanatory notes(1) Quarterly consolidated balance sheet
Previous consolidated
accounting period(March 31, 2017)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Deferred tax assets
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Tangible fixed assets
Buildings and structures, net
Tools, furniture and fixtures, net
Land
Other, net
Tangible fixed assets total
Intangible assets
Trademark rights
Goodwill
Other
Intangible assets total
Investments and other assets
Investment securities
Guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total Assets－

7 －(Unit: JPY million)
2 quarter consolidated
accounting period(September 30, 2017)
nd

69,43983,260
4,597
8,562
-619
165,240

81,30680,983
4,517
7,697
-478
174,026

2,231
1,263
803
541
4,840

2,478
1,316
803
502
5,100

4,995
68,561
9,310
82,867

4,839
65,476
10,46580,781

7,782
5,765
1,371
547
-51
15,415
103,123
268,364

8,697
6,133
1,331
396
-27
16,530102,412276,438

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

(Unit: JPY million)
2 quarter consolidated
accounting period(September 30, 2017)ndPrevious consolidated
accounting period(March 31, 2017)
Liabilities
Current liabilities
Accounts payable – trade
Short-term loans payable
Current portion of long-term loans payable
Accounts payable - otherAccrued income tax
Accrued consumption taxes
Provision for bonuses
Provision for directors' bonuses
Other
Total current liabilities
Non-current liabilities
Convertible bonds with subscription rights tosharesLong-term loans payable
Deferred tax liabilities
Net defined benefit liability
Long-term accounts payable-other
Reserve for share benefits
Reserve for director share benefits
Other
Total non-current liabilities
Total Liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on marketable securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Total accumulated other comprehensive
incomeNon-controlling interests
Total Net Assets
Total Liabilities and Net Assets

－

8 －

1,490
413
4,640
47,627
8,315
9,619
9,063
173
6,569
87,913

1,625
－
4,640
48,2087,474
10,446
9,192
4
9,137
90,73031

27

20,426
2,793
1,093
2,197
－
－
92
26,634
114,547

18,103
2,967
1,129
2,363
63
39
101
24,795
115,525

17,465
20,156
102,432-3,328
136,725

17,467
20,182
109,552-4,578142,623

2,203
－
190

2,673
206
225

2,394

3,106

14,696
153,816
268,364

15,184160,913
276,438

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

(2) Quarterly consolidated profit and loss statement & quarterly consolidated comprehensive income statement(Quarterly consolidated profit and loss statement)nd(Consolidated cumulative 2 quarter period)

Sales
Cost of sales
Gross profit on sales
Selling, general and administrative expenses (SGA)
Operating profit
Non-operating income
Interest income
Dividend income
Subsidy income
Compensation income
Share of profit of entities accounted for using
equity method
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange loss
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of subsidiaries and affiliates’ stocks
Gain on sales of investment securities
Gain on sales of fixed assets
Gain on revision of retirement benefit plan
Extraordinary income total
Extraordinary losses
Impairment loss
Loss on valuation of investment securities
Loss on revisions to the retirement benefit plan
Early extra retirement payments
Total extraordinary losses
Net quarterly profit before taxes etc.
Corporate tax, resident tax, and business tax
Corporate tax etc.-deferred
Total corporate taxes etc.
Quarterly net profit
Quarterly net profit attributable to non-controllinginterests
Quarterly net profit attributable to parent company
shareholders(Unit: JPY million)
Previous consolidated
This consolidated cumulativendstcumulative 2 quarter period
1 quarter period(From April 1, 2016
(From April 1, 2017
to September 30, 2016)
to September 30, 2017)276,790324,780
208,786
247,356
68,00377,424
51,342
61,407
16,66016,017

－

9 －

4
56
101
55

13
88
467
－

56

74

－
117
392

3
85
733

66
24
16
107
16,94553－
29
82
16,668

－
－
－
187
187

2
40
0
－
42

422
－
－
207
629
16,503
6,437
-403
6,033
10,469

7
28
261
17
314
16,395
6,494
83
6,578
9,817

604

593

9,865

9,223

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

(Quarterly consolidated comprehensive income statement)
Consolidated cumulative 2ndquarter period

Quarterly net profit
Other comprehensive income
Valuation difference on marketable securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net oftax
Total other comprehensive income
Quarterly comprehensive income(Breakdown)
Quarterly comprehensive income attributable toparent company shareholders
Quarterly comprehensive income attributable tonon-controlling interests(Unit: JPY million)
Previous consolidated
This consolidated cumulativendnd
cumulative 2 quarter period
2 quarter period(From April 1, 2016
(From April 1, 2017
to September 30, 2016)
to September 30, 2017)10,469
9,817

－

10 －

-431
－
-1,257

470
206
54

194

－

-1,494
8,974

730
10,548

8,486

9,935

488

612

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

(3) Consolidated quarterly cash-flow statement
Previous consolidatedndcumulative 2 quarter period(From April 1, 2016
to September 30, 2016)(Unit: JPY million)
This consolidated cumulativend
2 quarter period(From April 1, 2017
to September 30, 2017)

16,503
1,965
422
2,943
-1,419－－-143

16,395
1,859
7
3,171
35
63
39
225

-64

-168

5

-120

-61
66

-102
53

-56

-74

－

-2

－
－
－
-101
-55

-40
28
-0
-467
－

2,643

2,334

-1,405
4,565

－
3,606

-691

1,034

364

322

466
98
26,045
71
-65
－
101
55
-4,892
1,267
22,584-171-237
27,792
114
-53
40
467
－
-7,377
1,540
22,524

Net cash provided by (used in) operating activities
Net quarterly profit before taxes etc.
Depreciation and amortization
Impairment loss
Amortization of goodwill
Increase (decrease) in net defined benefit liability
Provision of reserve for director share benefits
Provision of reserve for share benefit
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for directors'
bonuses
Increase (decrease) in allowance for doubtful
accounts
Interest and dividend income
Interest expenses
Share of (profit) loss of entities accounted forusing equity method
Loss (gain) on sales of shares of subsidiaries andassociates
Loss (gain) on sales of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on disposal of non-current assets
Subsidy income
Compensation income
Decrease (increase) in notes and accounts
receivable - trade
Decrease (increase) in inventory assets
Increase (decrease) in operating debt
Increase (decrease) in accrued consumption
taxes
Increase (decrease) in long-term accounts
payable – other
Decrease (increase) in other assets
Increase (decrease) in other liabilities
SubtotalInterest and dividend income received
Interest expenses paid
Proceeds from subsidy income
Proceeds from subsidy income
Proceeds from compensation
Income taxes paid
Income taxes refund
Net cash provided by (used in) operating activities

－

11 －

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Previous consolidatedndcumulative 2 quarter period(From April 1, 2016
to September 30, 2016)(Unit: JPY million)
This consolidated cumulativend
2 quarter period(From April 1, 2017
to September 30, 2017)

-1
－
-649

-0
6
-1,175－0-2,943－-89－-2,429
29
-253
50

-391

－

-13
10
-139
192
103
-3,921

-53
20
-587
112
-9
-4,290-172-413-2,320-0－-1,641-118-36-4,288-2,320-1,27649-2,104-128-53-6,247-305-114

14,06911,872

51,13865,20869,382
81,254

Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant andequipment
Purchase of intangible assets
Proceeds from sales of associates
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of shares of subsidiaries resulting inchange in scope of consolidation
Payments for transfer of businessCollection of loans receivable
Payments for guarantee deposits
Proceeds from collection of guarantee deposits
Other
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans
payableRepayments of long-term loans payable
Purchase of treasury shares
Proceeds from sales of of treasury shares
Cash dividends paid
Dividends paid to non-controlling interests
Other
Cash flows from financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash
equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

－

12 －

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

(4) Explanatory notes regarding quarterly consolidated financial statements(Explanatory notes regarding ongoing concern assumptions)No applicable matters.
(Explanatory notes in the event there are significant changes in the amount of shareholders’ equity)
No applicable matters.
(Application of special accounting treatment when preparing the quarterly consolidated financial statements)
No applicable matters.
(Segment information etc.)(Segment information)
1. Information regarding sales, profits or losses for each reporting segment
Previous consolidated cumulative 2ndquarter period (from April 1, 2016 to September 30, 2016)(Unit: JPY million)

Reporting segment

Temporary

Recruiting

Overseas

ITO

213,724

31,718

7,401

9,332

778

274

5

3,518

214,503

31,992

7,406

12,851

9,931

4,738

-422

688

Staffing/BPO

Engineering

Total
amountOther
Notes: 1.

Total

Quarterly
Adjustment consolidated
amountprofit and loss
Notes: 2.
statement
Notes: 3.

Sales
Sales toexternal

12,536 274,712

2,036 276,749

41

276,790

5,824-5,824-

3,274 282,573-5,783276,790555

16,660clients
Internal sales
or transfers
between

9

4,587

1,237

segments
Total amount
Segment profits
or losses (-)

Current consolidated cumulative 2nd12,545 279,299
1,006

15,942

162

16,105quarter period (from April 1, 2017 to September 30, 2017)(Unit: JPY million)

Reporting segment

Temporary

Recruiting

Overseas

ITO

234,453

34,90931,753

9,815

1,036

426

38

3,716

235,489

35,33531,792

13,532

Staffing/BPO

Engineering

Total
amountOther
Notes: 1.

Total

Quarterly
Adjustment consolidated
amountprofit and loss
Notes: 2.
statement
Notes: 3.

Sales
Sales toexternal

13,060 323,991

784 324,776

4324,780

6,411-6,4110

1,976 331,187-6,406

324,780clients
Internal sales
or transfers
between

1

5,219

1,191

segments
Total amount－13,062 329,211

13 －【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Segment profits
or losses (-)

10,676

4,705

-285

483

709

16,289-98

16,190-173

16,017

Notes: 1. The "Other" category refers to business segments that are not included in reporting segments that
include HR services which fulfill Group-wide functions such as: shared-services, education andtraining etc.
2. Details of these revisions are as follows.
Previous consolidatedndcumulative 2 quarter period(Unit: JPY million)
This consolidated cumulativend
2 quarter period

Inter-segment write-offs

53

-166

Company-wide revenues
※1

2,643

3,991

Company-wide expenses※2-2,141-3,998

Total

555

-173

※1. Company-wide revenues: mainly business management fees from Group companies, anddividends received.
※2. Company-wide expenses: mainly expenses arising in PHD related to management of Group
companies.
3. Segment profit and loss: Adjusted with operating profit calculated in the quarterly consolidated profit
and loss statement.

－

14 －

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

2. Information relating to assets of each reporting segmentndPrevious consolidated cumulative 2 quarter period (from April 1, 2016 to September 30, 2016)nd
During this consolidated cumulative 2 quarter period, a new acquisition of Kelly Services (Singapore)
Pte. Ltd. shares took place, and its subsidiaries have been included in the scope of consolidation.
Accordingly, compared with the end of the previous consolidated accounting period, the amount of assets
in this reporting segment during this consolidated cumulative 2
million in the overseas segment.
Current consolidated cumulative 2ndndquarter period increased by JPY 15,684

quarter period (from April 1, 2017 to September 30, 2017)

No applicable matters.
3. Matters relating to reporting segment changes etc.
Aiming to strengthen the strategy design function and promotion of strategy, and to clarify responsibilities
in response to a rapidly changing market and to achieve nimble management decision making, from thefiscal year ending Mar 2016 THD Group began operating with 4 reporting segments: Temporary
Staffing/BPO, ITO, Engineering, and Recruiting.
Greater importance of the overseas segment was acknowledged, and from the fiscal year ending March2018 the overseas segment (previously included in the Recruiting Segment) will be established as aseparate “Overseas” segment. A transition will be made to a system comprised of five reporting segments(Temporary Staffing/BPO, Recruiting, Overseas, ITO, and Engineering) to improve future management linesof reporting.
ndMoreover, segment information relating to the previous consolidated cumulative 2 quarter period has
been released after being created in accordance with reporting segment classifications applied during thisconsolidated cumulative 2ndquarter period.

4. Information concerning impairment loss for non-current assets or amortization of goodwill etc. in eachreporting segment(Important impairment losses relating to non-current assets)ndPrevious consolidated cumulative 2 quarter period (from April 1, 2016 to September 30, 2016)
At the PERSOL Management Committee meeting held on September 2, 2016, a resolution was passed
for an absorption-type company split to take place on January 1, 2017 with consolidated subsidiary
Tempstaff Technology Co., Ltd. in respect to the engineer temporary staffing business of consolidated
subsidiary Intelligence, Co., Ltd. To maximize future business synergies, trademarks applied to theengineer temporary staffing sector will be reduced in price because the "Intelligence" trademark will nolonger used in PERSOL`s engineer temporary staffing sector. As a result of this event, an impairment lossof JPY 280 million was booked in relation to the Temporary Staffing/BPO Segment.
Furthermore, consolidated subsidiary Medicross Co., Ltd. goodwill was booked at the time the shareswere acquired however, due to decline in profitability, the book value has been reduced to a recoverable
amount. As a result of this event, an impairment loss of JPY 141 million was booked in relation to the
Temporary Staffing/BPO Segment.
Current consolidated cumulative 2ndquarter period (from April 1, 2017 to September 30, 2017)

No applicable matters.
(Important changes to amounts of goodwill)ndPrevious consolidated cumulative 2 quarter period (from April 1, 2016 to September 30, 2016)
Goodwill amortization in the overseas segment increased by JPY 4,621 million as a result of theacquisition of shares in Kelly Services (Singapore) Pte. Ltd. on July 4, 2016 and making it a newconsolidated subsidiary.
Current consolidated cumulative 2ndquarter period (from April 1, 2017 to September 30, 2017)－15 －【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

No applicable matters.

－

16 －

【Translation】
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes.
In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

(Significant past events)(Business mergers by acquisition)
A PHD Board of Directors meeting held on July 14, 2017 resolved to commence procedures to acquire(hereinafter, "this share acquisition"), by way of an Australian subsidiary, 100% of the fully issued shares in
Programmed Maintenance Services Limited (hereinafter, "Programmed") and to make Programmed a subsidiary.
Programmed is listed on the Australian Stock Exchange and is involved in the HR services business andmaintenance business primarily in Australia.
As a result of steps taken based on the resolution noted above, procedures for this share acquisition werecompleted on October 27, 2017 and Programmed became a wholly-owned subsidiary of PHD.
1. Purpose of this share acquisition
With respect to PHD's overseas business, in 2010 a strategic business alliance agreement was signed with
Kelly Services Ltd., a major HR services company in the U.S. In 2012, both firms launched a joint venture in
North Asia. Furthermore, in 2016, the joint venture was expanded to cover the entire Asia Pacific region andfocuses on temporary staffing, recruitment, and HR management consulting. The JV is currently developing
business in 13 countries and regions: PRC, Hong Kong, South Korea, Taiwan, Singapore, Vietnam, Indonesia,
Malaysia, Thailand, India, New Zealand, Australia, and the U.S.
On the other hand, Programmed was established as a painting services company in 1951, and after merging
etc. with a major Australian HR services company etc., is presently a leading HR services and maintenancecompany. Programmed focuses on the HR services sector (temporary staffing and recruitment), and facility
management (commercial facilities and schools, painting, land development, and mine facility maintenance).
Programmed had consolidated sales of AUD 2,691 million and consolidated EBITDA of AUD 96 million in thefiscal year ended March 2017.
PHD decided to carry out this acquisition seeking to further expand its business by combining the strong
business foundations of both companies: the know-how and customer base cultivated in the Asia Pacific region
by PERSOL together with the scale/results of Programmed in Australia etc.
2. Overview of the company subject to acquisition
Acquisition company name: Programmed Maintenance Services Limited
Business outline: Placement/recruitment, temporary staffing, equipment/facilities maintenance
Scale: Capital AUD 570 million (approx. JPY 49.7 billion)(Fiscal year ended March 2017) Consolidated net assets AUD 607 million (approximately JPY 52.9 billion)
Consolidated net assets AUD 1,293 million (approx. JPY 112.8 billion)
Consolidated sales AUD 2,691 million (approx. JPY 234.9 billion)
Note: Amounts in yen shown in ( ) have been converted using the exchange rate on October 27, 2017(business merger date) (1 AUD = 87.30 JPY).
3. Number of acquired shares, acquisition price, and status of shareholding before and after acquisition
Number of shares owned prior to acquisition:
0 shares (Number of voting rights: 0, ratio of holding:
0.00%)
Number of shares to be acquired: 262,092,748 shares (number of voting rights：262,092,748)
Acquisition price: AUD 749 million (approx. JPY 66 billion)
Number of shares owned after acquisition: 262,092,748 shares (number of voting rights：262,092,748, ratio ofholding: 100.00%)
Note: The acquisition price shown in Japanese yen is the amount converted into JPY at the exchange rateagreed upon with the bank at 1AUD = JPY 88.15
4. Business Merger Date
October 27, 2017
5. Fund-raising method used to make payment
Bank loans and own funds－

17 －