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 Year Ended February 28, 2015
(Based on Japanese GAAP)
April 13, 2015
Company name:

Gulliver International Co., Ltd.

Stock exchange listing: Tokyo
Stock code:
7599
Representative:
Inquiries:

URL

http://221616.com

ChairmanAccounting and Finance Section Manager

Kenichi Hatori
Masayuki Matsumoto

Scheduled date of ordinary general meeting of shareholders:
Scheduled date to file Securities Report:

May 28, 2015
May 29, 2015

Scheduled date to commence dividend payments:
Preparation of supplementary material on financial results:

May 29, 2015
Yes

Holding of financial results meeting:

Yes

TEL

03-5208-5503(for analysts and institutional investors)(Amounts less than one million yen are rounded down)

1. Consolidated financial results for the year ended February 28, 2015 (from March 1, 2014 to February 28, 2015)(1) Consolidated financial results
Percentages indicate year-on-year changes
Net salesYear ended February 28, 2015
Year ended February 28, 2014

Millions of yen
155,681
169,398

Operating income% Millions of yen
(8.1)
5,325
18.1
7,094

Diluted net income
per share
Yen
Yen
32.42
32.41
43.01
43.00

Net income per share
Year ended February 28, 2015
Year ended February 28, 2014

Ordinary income% Millions of yen(24.9)
5,345
39.7
7,201

Net income% Millions of yen(25.8)
3,286
37.1
4,360

Ordinary
income/total assets
%
%
9.7
9.7
14.0
13.6

Net income/equity%(24.6)
46.3

Operatingincome/net sales
%
3.4
4.2

(2) Consolidated financial position
Total assets

Net assets

Millions of yen
57,153
52,779Millions of yen
34,62932,846

Cash flows fromoperating activities
Millions of yen
56
10,061

Cash flows frominvesting activities
Millions of yen(8,540)3,734

As of February 28, 2015
As of February 28, 2014

Equity ratio

Net assets per share
%
60.6
62.2

Yen
341.49323.99(3) Consolidated cash flows

Year ended February 28, 2015
Year ended February 28, 2014

Cash flows from
Cash and cash equivalents
financing activities
at end of period
Millions of yen
Millions of yen(1,721)
4,863(5,981)
14,661

2. Cash dividends
Ratio of
Dividend
Total cash
dividends topayout ratio
dividends (Total) (Consolidated)
net assets(Consolidated)

Annual dividends per share
1st quarter-end 2nd quarter-end 3rd quarter-end Fiscal year-end

Total

Yen

Yen

Yen

Yen

Yen

Millions of yen%%

Year ended February 28, 2014
Year ended February 28, 2015

–
–

5.00
7.50

–
–

8.00
7.50

13.00
15.00

1,317
1,521

30.2
46.3

4.2
4.5

Year ending February 29, 2016 (Forecast)

–

7.50

–

7.50

15.00

1

31.0

3. Forecast of consolidated financial results for the year ending February 29, 2016 (from March 1, 2015 to February 29, 2016)

Net sales
Millions of yen
Six months ending
August 31, 2015
Full year

Percentages indicate year-on-year changes
Net income
Operating income
Ordinary income
Net income
per share% Millions of yen% Millions of yen% Millions of yen%
Yen

85,000

13.9

3,000

10.0

3,000

8.8

1,800

9.4

17.75

180,000

15.6

8,200

54.0

8,200

53.4

4,900

49.1

48.32

4. Notes(1) Changes in significant subsidiaries during the year ended February 28, 2015(changes in specified subsidiaries resulting in the change in scope of consolidation):No(2) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
Changes in accounting policies due to revisions to accounting standards and other regulations:No
Changes in accounting policies due to other reasons:
Changes in accounting estimates:

No
Yes

Restatement of prior period financial statements after error corrections:No(3) Number of issued shares (common shares)
Total number of issued shares at the end of the period (including treasury shares)
As of February 28, 2015

106,888,000 shares As of February 28, 2014

106,888,000 shares

Number of treasury shares at the end of the period
As of February 28, 2015

5,480,170 shares As of February 28, 2014

5,520,070 shares

101,391,294 shares Year ended February 28, 2014

101,368,184 shares

Average number of shares during the period
Year ended February 28, 2015

2

1.

Operating results(1) Analysis of consolidated operating results
In the fiscal year under review, total retail sales volume of cars over the whole year amounted to approximately 52,000, a record since thefounding of Gulliver, despite sluggish market conditions following the consumption tax hike in April last year. Contributing factors included aboost to car sales from opening new display sales stores such as WOW!TOWN, OUTLET, LIBERALA, and SNAP HOUSE, and a strong sales
performance by existing display sales stores.
On the other hand, existing Gulliver stores saw fewer store visitors due to the impact of conservative consumer spending caused by the
consumption tax hike in April last year. To counteract this, Gulliver made advertising expenditure centered on the Internet. Selling, general andadministrative (SG&A) expenses showed increases in these sorts of advertising expenditures, along with expenses related to store operations,accompanying an increased number of display sales stores.
Due to the above, consolidated business results for the fiscal year under review were as follows: consolidated net sales were 155,681 million
yen (down 8.1% from the previous fiscal year), operating income was 5,325 million yen (down 24.9% from the previous fiscal year), ordinary
income was 5,345 million yen (down 25.8% from the previous fiscal year) and net income was 3,286 million yen (down 24.6% from the previous
fiscal year).
In the fiscal year under review, K.K. Motoren Global, Nakamitsu Motors Co., LTD. and Nakamitsu International Inc. became newly
consolidated subsidiaries of the Gulliver Group. However, Gulliver has consolidated only the balance sheets of these three companies for the
fiscal year under review. This is to reflect the increased materiality of K.K. Motoren Global at the fiscal year-end, and the decision to set theeffective acquisition dates of Nakamitsu Motors Co., LTD. and Nakamitsu International as the fiscal year-end.
Outlook for the fiscal year ending February 29, 2016
Considering the strong retail sales volume of cars at display sales stores, Gulliver will continue to accelerate the opening of new display sales
stores. For this reason, Gulliver expects total retail sales volume of cars at all directly managed stores to increase in the fiscal year ending
February 29, 2016.
With the above in mind, as the outlook for the full fiscal year, we expect consolidated net sales of 180,000 million yen (up 15.6% from thefiscal year under review), operating income of 8,200 million yen (up 54.0% from the fiscal year under review), ordinary income of 8,200 million
yen (up 53.4% from the fiscal year under review) and net income of 4,900 million yen (up 49.1% from the fiscal year under review).
(2) Analysis of financial position[Assets, liabilities and net assets]
AssetsTotal assets as of February 28, 2015 were 57,153 million yen, up 8.3% from February 28, 2014.
Current assets were 29,402 million yen, a decrease of 12.1% from the same date. The primary contributing factors were a 9,791 decrease in cash
and deposits and a 2,544 decrease in notes and accounts receivable-trade, despite a 7,605 million yen increase in merchandise.
Total non-current assets increased by 43.7% from February 28, 2014, to 27,750 million yen. This mainly reflected a 4,069 million yen increasein buildings and structures, mainly due to the opening of new directly managed stores, and a 464 million yen increase in construction in progress.
Of the total amount of accounts receivable-trade, the accounts receivable (financial credit) of consolidated subsidiary G-One Financial Services
Co., Ltd. stood at 1,158 million yen.
Among the factors increasing total assets, there was an increase of 3,614 million yen due to the consolidation of K.K. Motoren Global,
Nakamitsu Motors Co., LTD., and Nakamitsu International Inc.
Liabilities
Total liabilities as of February 28, 2015 increased by 13.0% from February 28, 2014 to 22,523 million yen.
Current liabilities as of February 28, 2015 increased by 46.7% from February 28, 2014 to 19,847 million yen. The primary contributing factors
were a 4,797 million yen increase in short-term loans payable and current portion of long-term loans payable as well as a 380 million yen
increase in deposits received, despite a 1,873 million yen decrease in income taxes payable.
Total non-current liabilities at February 28, 2015 decreased by 58.2% from February 28, 2014 to 2,676 million yen. The primary contributing
factor was a 3,956 million yen decrease in long-term loans payable due to a transfer to current portion of long-term loans payable.
Among the factors increasing total liabilities, there was an increase of 3,613 million yen due to the consolidation of K.K. Motoren Global,
Nakamitsu Motors Co., LTD., and Nakamitsu International Inc.
Net assets
Net assets as of February 28, 2015 increased by 5.4% from February 28, 2014 to 34,629 million yen, mainly due to a 1,730 million yen increase
in retained earnings accompanying the posting of net income.

3

[Cash flow position]
For the current consolidated account period, the cash flow from operating activities and investment activities was negative. Overall cash flow
was a negative 10,200 million yen.
The balance of cash and cash equivalents at the end of the current consolidated account period was 4,863 million yen.
(Cash flow from operating activities)
Cash and cash equivalents generated from operating activities (hereinafter referred to as “cash”) was 56 million yen.
This primarily included net income before adjustment for taxes of 5,157 million yen, a 3,022 million yen decrease in accounts receivable ,a6,071 million yen decrease in inventory assets, payment for income tax of 3,324 million yen and others.
(Cash flow from investment activities)
Net cash used in investing activities was 8,540 million yen. This was mainly the result of the purchase of property, plant and equipment due tothe opening of new directly managed stores, the purchase of investments in subsidiaries resulting in change in scope of consolidation, andpayments of construction assistance fund receivables.
(Cash flow from financing activities)
Net cash used in financing activities was 1,721 million yen, largely the result of outflows for the payment of dividents.
Trends in shareholders’ equity and cash flow indicators are as follows:
FY 2011

FY 2012FY 2013

FY 2014

FY 2015

Equity ratio (%)

41.6

49.9

55.3

62.2

60.6

Shareholders’ equity(market price base) ratio
(%)

61.4

58.7

73.3

150.4

166.1

Debt redemption years

1.4

1.0

2.9

0.4

95.0

Interest coverage ratio

80.8

66.7

31.2

157.7

1.3

Notes:
1. Breakdown of each indicator
Equity ratio = shareholders’ equity/total assets
Shareholders’ equity (market price base) ratio = Market capitalization/Total assets
Debt redemption years = Interest bearing debt/Operating cash flow
Interest coverage ratio = Operating cash flow/Interest payments
2. Each index is calculated from consolidated figures
3. Market capitalization is calculated using the formula: closing share price at period end x number of shares issued (excluding treasury stock).
(3) Basic policy concerning distribution of profit and dividend for current and next term
Basic policy concerning dividend and target
We have identified the return of profit to investors as a key management issue and also emphasize our dividend payout ratio. We are focusedon ensuring the performance-based return of profit. In specific terms, we are targeting a dividend payout ratio of about 30% of consolidated
current net income.
Given the above basic policy and target, our expected dividends may be amended if the consolidated net income is not as expected.
Dividend for current
In October 2014, Gulliver marked the 20th anniversary of its founding. In this landmark year, the Company plans to pay a commemorative
year-end dividend of 5 yen per share for the fiscal year under review, to express its appreciation for the support of its shareholders over many
years. As stated above, Gulliver’s policy on dividends has been to pay a dividend linked to earnings performance, applying a payout ratio of 30%
on consolidated net income as a yardstick in deciding the dividend amount. However, the planned commemorative dividend is to be paid
separately from this performance-linked dividend.
In consideration of Gulliver’s basic policy, targets, and the payment of a commemorative dividend, Gulliver plans to pay an annual dividend of
15 yen per share for the fiscal year under review, comprising interim and year-end dividends of 7.50 yen each.
Dividend for next term
In accordance with the above policies and targets, assuming consolidated net income of 4,900 million yen, we plan a cash dividend per sharefor the next term of 15 yen on a yearly basis (7.5 yen at the end of the second quarter, 7.5 yen at the end of the year).

4

2.

Business policy(1) The Company’s basic business policy
Gulliver has embraced “Growing Together” as its corporate philosophy. Guided by the principle of building win-win relationships, Gulliver
seeks to grow together with customers, employees, partners, shareholders and all other people involved with the Gulliver Group, as well associety as a whole. To make this corporate philosophy a reality, management is determined to establish Gulliver as a highly admired enterprisethat has the support of its customers at all times. In addition to the used car purchasing business, its founding business for which it has establisheda proven business model, Gulliver aims to bring about a Car Distribution Revolution through its retail business, which it has been focusing on inrecent years. Gulliver will constantly scale new heights in order to create automotive lifestyles that its customers enjoy.
(2) Key performance indicators
Since its founding in 1994, Gulliver has expanded its business primarily around the purchasing of used cars as a specialist car purchaser and thewholesaling of cars via used car auctions. In addition to these activities, in recent years Gulliver has been strengthening its retail business, inwhich it sells used cars directly to general consumers. Over the medium term, the Company is targeting a retail car sales volume of 150,000 at its
directly managed stores. Eyeing this target, Gulliver is working to further enhance its corporate value.
(3) The Company’s medium- and long-term business strategy
Gulliver is targeting a retail car sales volume of 150,000 at its directly managed stores. To reach this target, the Company is concentrating its
business resources and implementing the following measures:
Establish a network of 800 stores by accelerating the opening of display sales stores
Enhance sales and service capabilities by bolstering staff training
Win repeat customers and referrals by enhancing customer satisfaction
Enhance brand power and name recognition
Develop new services to expand the retail business(4) The Company’s priorities ahead
Gulliver will address diversifying customer needs and the shift away from cars in Japan due to its aging society with fewer children. To do so,
the Company will implement measures such as providing a more diverse range of services, bolstering staff training, and conducting more finely
tuned marketing activities. Through these measures, Gulliver will strive to differentiate itself from competitors and become the company ofchoice for all manner of customers.

5

3.

Consolidated financial statements
Consolidated balance sheets(Millions of yen)
As of February 28, 2014

As of February 28, 2015

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade

14,688
7,163

4,897
4,619

Merchandise
Deferred tax assets

9,414
1,210

17,020801

Other
Allowance for doubtful accounts

1,046
(59)

2,114
(49)

Total current assets

33,46329,402

15,586(5,605)

20,622(6,571)

9,981

14,051

215
(185)

571
(104)

30

466

2,740
(2,165)

3,155(2,414)

575

741

218
184

218
649

10,98916,126

Intangible assets
Software

993

1,332

Goodwill
Other

1
15

1,997
19

1,011

3,349

3

0

435
251

71
124

3,319
2,812

4,034
3,472

253
302

268
381

Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Buildings and structures, net
VehiclesAccumulated depreciation
Vehicles, net
Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net
LandConstruction in progress
Total property, plant and equipment

Total intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries and associates
Long-term loans receivable
Lease and guarantee deposits
Construction assistance fund receivables
Deferred tax assets
Other
Allowance for doubtful accounts

(62)

(78)

Total investments and other assets

7,315

8,274

19,31627,75052,77957,153

Total non-current assets
Total assets

6

(Millions of yen)
As of February 28, 2014

As of February 28, 2015

Liabilities
Current liabilities
Accounts payable - trade

2,852

5,100

–
–

150
4,647

Current portion of bonds
Accounts payable - other

–
1,721

495
2,203

Income taxes payable
Advances received

2,116
2,632

242
2,951

Deposits received
Provision for bonuses

98
440

479
436

Provision for merchandise warranties
Other

1,817
1,846

1,276
1,864

Total current liabilities

13,525

19,847

Non-current liabilities
Long-term loans payable

4,000

43

741
474

690
507

Asset retirement obligations

1,191

1,435

Total non-current liabilities

6,407

2,676

19,93322,523

Shareholders' equity
Capital stock

4,157

4,157

Capital surplus
Retained earnings

4,032
28,548

4,032
30,278Treasury shares(3,975)(3,947)

Total shareholders' equity

32,761

34,521

Foreign currency translation adjustment

80

108

Total accumulated other comprehensive income

80

108

4

–

32,846

34,62952,77957,153

Short-term loans payable
Current portion of long-term loans payable

Long-term guarantee deposited
Provision for directors' retirement benefits

Total liabilities
Net assets

Accumulated other comprehensive income

Subscription rights to shares
Total net assets
Total liabilities and net assets

7

Consolidated statements of income and consolidated statements of comprehensive income
Consolidated statements of income(Millions of yen)
Fiscal year ended

Fiscal year ended

February 28, 2014

February 28, 2015

Net sales

169,398

155,681

Cost of sales

132,843

116,605

Gross profit

36,55439,075

Selling, general and administrative expenses

29,46033,750Operating income

7,094

5,325

64

19

Reimbursement claims
Foreign exchange gains

19
11

12
0

Reversal of allowance for doubtful accounts
www

52
11

–
14

Other

22

41

Total non-operating income

181

89

Interest expenses
Provision of allowance for doubtful accounts

63
–

42
0

Loss on insurance cancellation
Other

–
10

17
8

Non-operating income
Interest income

Non-operating expenses

Total non-operating expenses
Ordinary income
Extraordinary income
Reversal of provision for loss on business of subsidiaries andassociates
Other

74

69

7,201

5,345

50

–

0

0

50

0

99

104

Impairment loss
LessContractCancelationPenalty

52
–

55
24

Other

27

4

Total extraordinary losses

180

188

Income before income taxes and minority interests

7,071

5,157

Income taxes - current
Income taxes - deferred

2,961
(249)

1,476
394

Total income taxes

2,711

1,871

Income before minority interests

4,360

3,286

Net income

4,360

3,286

Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets

8Consolidated statements of comprehensive income(Millions of yen)
Fiscal year ended
February 28, 2014
Income before minority interests
Other comprehensive income

Fiscal year ended
February 28, 2015
4,360

3,286

Foreign currency translation adjustment

17

28

Total other comprehensive income

17

28

4,377

3,314

4,377

3,314

Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent

9Consolidated statements of changes in net assets
Fiscal year ended February 28, 2014
(Millions of yen)
Shareholders' equity
Capital stock
Balance at beginning of current
periodChanges of items during period

Capital surplus

Retained earnings

Treasury shares

4,032

25,171(3,975)

4,157

Total
shareholders'equity29,385

Dividends of surplus

(983)

(983)

Net income

4,360

4,360

Purchase of treasury shares
Net changes of items otherthan shareholders' equity
Total changes of items during
periodBalance at end of current period

(0)

–

–

3,376

(0)

3,376

4,157

4,032

28,548(3,975)32,761

Accumulated other comprehensive income
Total accumulated
Foreign currency
other comprehensive
translation adjustment
incomeBalance at beginning of current
periodChanges of items during period

(0)

62

62

Subscription rights toshares3

Total net assets

29,451Dividends of surplus(983)

Net income

4,360

Purchase of treasury shares
Net changes of items otherthan shareholders' equity
Total changes of items during
periodBalance at end of current period

(0)
17

17

1

18

17

17

1

3,395

80

80

4

32,846

10

Fiscal year ended February 28, 2015
(Millions of yen)
Shareholders' equity
Capital stock
Balance at beginning of current
periodChanges of items during period
Change of scope of
consolidation
Dividends of surplus
Transfer of loss on disposal oftreasury shares
Net income

Capital surplus

Retained earnings

Treasury shares

4,032

28,548(3,975)

4,157

11

27

(1,571)(1,571)

(11)

–

3,286

3,286

(11)

(0)

(0)

28

17

–

–

1,730

28

1,759

4,157

4,032

30,278(3,947)34,521

Accumulated other comprehensive income
Total accumulated
Foreign currency
other comprehensive
translation adjustment
incomeBalance at beginning of current
periodChanges of items during period
Change of scope of
consolidation
Dividends of surplus
Transfer of loss on disposal oftreasury shares
Net income

32,761

27

Purchase of treasury shares
Disposal of treasury shares
Net changes of items otherthan shareholders' equity
Total changes of items during
periodBalance at end of current period

Totalshareholders'equity80

80

Subscription rights toshares4

Total net assets

32,84627(1,571)–
3,286

Purchase of treasury shares(0)

Disposal of treasury shares
Net changes of items otherthan shareholders' equity
Total changes of items during
periodBalance at end of current period

17
28

28

(4)

23

28

28

(4)

1,783

108

108

–

34,62911

Consolidated statements of cash flows(Millions of yen)
Fiscal year ended
February 28, 2014
Cash flows from operating activities
Income before income taxes and minority interests

Fiscal year ended
February 28, 2015
7,071

5,157

1,354
0

1,643
8

Increase (decrease) in provision for bonuses
Increase (decrease) in allowance for doubtful accounts

(24)
(52)

(3)
3

Increase (decrease) in provision for merchandise warranties
Increase (decrease) in provision for directors' retirement

308

(540)

(18)

32

(64)

(19)

Interest expenses
Foreign exchange losses (gains)

63
(11)

42
3

Loss on retirement of non-current assets
Lease contract cancellation penalty

99
–

104
24

Impairment loss
Decrease (increase) in notes and accounts receivable - trade

52
2,545

55
3,022

Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable - trade

942
(592)

(6,071)
298

Increase (decrease) in accrued consumption taxes
Other, net

352
(544)

(324)
(32)

11,483

3,403

64
(63)

19
(42)

Income taxes paid

(1,422)(3,324)

Net cash provided by (used in) operating activities

10,061

56

Purchase of property, plant and equipment
Purchase of intangible assets(2,481)(426)(5,194)(686)

Payments for asset retirement obligations
Payments of loans receivable

(15)
(120)

(30)
(231)

Collection of loans receivable
Payments for lease and guarantee deposits

7,204
(352)

3
(517)

Proceeds from collection of lease and guarantee deposits
Payments of construction assistance fund receivables

100
(334)

98
(930)

Collection of construction assistance fund receivables
Payments into time deposits

237
–

263
(30)

Proceeds from withdrawal of time deposits
Purchase of shares of subsidiaries and associates

–
(325)

59
(40)

–

(1,305)

246
1

–
1

3,734

(8,540)Depreciation
Amortization of goodwill

benefits
Interest and dividend income

SubtotalInterest and dividend income received
Interest expenses paid

Cash flows from investing activities

Purchase of shares of subsidiaries resulting in change in scopeof consolidation
Proceeds from liquidation of subsidiaries
Other, net
Net cash provided by (used in) investing activities

12

(Millions of yen)
Fiscal year ended
February 28, 2014
Cash flows from financing activities
Net increase (decrease) in short-term loans payable

Fiscal year ended
February 28, 2015
–

(140)

Repayments of long-term loans payable
Purchase of treasury shares(5,000)
(0)

(24)
(0)

Proceeds from exercise of share options
Cash dividends paid

–
(981)

12
(1,569)(5,981)(1,721)

10

6

Net increase (decrease) in cash and cash equivalents

7,824(10,200)

Cash and cash equivalents at beginning of period
Increase (decrease) in cash and cash equivalents

6,836

14,661–

402

14,661

4,863

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents

resulting from change of scope of consolidation
Cash and cash equivalents at end of period13

(Changes in accounting policies)
Changes in accounting estimate
In order to account for losses on repairs to vehicles with warrantees, the warranty estimate value for the warranty term was recorded based on
past results. However, having accumulated a sufficient amount of actual data related to repairs, we changed the method of calculating estimatesfrom the first quarter of the fiscal year under review, due to our ability to generate more precise estimates.
As a result, compared to the previous method, cost of sales for the fiscal year under review decreased by 666 million yen and operating income,ordinary income, and income before income taxes and minority interests all increased by the equivalent amount.
(Changes in method of presentation)
Consolidated balance sheets
From the fiscal year under review, “Goodwill” which had been included in “Other” under “Intangible assets” in the previous fiscal year, hasbeen stated as a separate item in the consolidated financial statements because its monetary amount exceeded ten percent of the total amount ofassets. In order to reflect this change in the method of presentation, “Goodwill” has been reclassified in the consolidated financial statements forthe previous fiscal year.
As a result of the change, the 17 million yen of “Other” under “Intangible assets” in the consolidated statements of income for the previous
fiscal year was reclassified as 1 million yen of “Goodwill” and 15 million yen of “Other.”
From the fiscal year under review, “Accounts payable - other” which had been included in “Other” under “Current liabilities” in the previous
fiscal year, has been stated as a separate item in the consolidated financial statements because its monetary amount exceeded five percent of thetotal amount of assets. In order to reflect this change in the method of presentation, “Accounts payable - other” has been reclassified in the
consolidated financial statements for the previous fiscal year.
As a result of the change, the 4,478 million yen of “Other” under “Current liabilities” in the consolidated statements of income for the previous
fiscal year was reclassified as 2,632 million yen of “Accounts payable - other” and 1,846 million yen of “Other.”Consolidated statements of income
In the fiscal year under review, the Gulliver Group reported an impairment loss for the following asset groups.
Fiscal year ended February 28, 2014
PurposeType
Location
Sales store
Building, etc.
Kansai region and elsewhere
In principle, the Gulliver Group groups its operating assets by sales store. In the fiscal year under review, the book value of sales store businessassets whose profitability had declined was written down to the recoverable value of these assets, and the difference was reported as a special
loss as an impairment loss of 52 million yen. This figure breaks down as 50 million yen for “Buildings and structures” and 2 million yen for“Tools, furniture and fixtures.” The recoverable value of this asset group is estimated from the value in use based on future cash flows. A value
in use that is negative indicates that the recoverable value has been evaluated as 0 yen.
Fiscal year ended February 28, 2015
PurposeType
Location
Sales store
Building, etc.
Tokai region and elsewhere
In principle, the Gulliver Group groups its operating assets by sales store. In the fiscal year under review, the book value of sales store businessassets whose profitability had declined was written down to the recoverable value of these assets, and the difference was reported as a special
loss as an impairment loss of 55 million yen. This figure breaks down as 53 million yen for “Buildings and structures” and 1 million yen for“Tools, furniture and fixtures.” The recoverable value of this asset group is estimated from the value in use based on future cash flows. A value
in use that is negative indicates that the recoverable value has been evaluated as 0 yen.

14

Non-consolidated financial statements
Non-consolidated balance sheets(Millions of yen)
As of February 28, 2014

As of February 28, 2015

AssetsCurrent assets
Cash and deposits
Accounts receivable - trade

13,970
3,554

2,655
3,260

Merchandise
Supplies

9,348
122

15,355151

Prepaid expenses
Deferred tax assets

561
1,233

629
821

17
475

39
951

Short-term loans receivable
Other
Allowance for doubtful accounts
Total current assets

(139)

(133)

29,14423,731

Non-current assets
Property, plant and equipment
Buildings

12,952

16,544

Accumulated depreciation(4,159)(4,715)

Buildings, net

8,792

11,828

2,626

3,530

Accumulated depreciation(1,441)(1,647)Structures, net

1,185

1,882

Structures

VehiclesAccumulated depreciation
Vehicles, net

211

5

(182)

(4)

29

0

2,734

3,092

(2,163)(2,379)

571

713

Land

218

218

Construction in progress

184

643

10,98015,287

1
1

1
0

990
14

1,331
14

1,007

1,347

Tools, furniture and fixtures
Accumulated depreciation
Tools, furniture and fixtures, net

Total property, plant and equipment
Intangible assets
Goodwill
Trademark right
Software
Other
Total intangible assets

15

(Millions of yen)
As of February 28, 2014

As of February 28, 2015

Investments and other assets
Investment securities
Shares of subsidiaries and associates
Long-term loans receivable
Long-term loans receivable from subsidiaries andassociates
Claims provable in bankruptcy, claims provable inrehabilitation and other
Long-term prepaid expenses
Lease and guarantee deposits
Construction assistance fund receivables
Deferred tax assets
Other

3
2,301

0
2,341

1

24

979

1,907

61

77

121

198

3,311
2,812

3,651
3,472

253
119

271
101

Allowance for doubtful accounts

(63)

(87)

Total investments and other assets

9,903

11,95921,891

28,59351,03552,325

Accounts payable - trade
Current portion of long-term loans payable

2,836
–

3,119
4,000

Accounts payable - other
Income taxes payable

1,593
2,061

1,604
149

Accrued consumption taxes
Accrued expenses

425
847

97
1,368

Advances received
Deposits received

2,632
98

2,923
120

Provision for bonuses
Provision for merchandise warranties

440
1,817

436
1,276

Accounts payable - facilities
Unearned revenue

149
281

515
126

Other

13

0

13,197

15,741Long-term loans payable
Long-term guarantee deposited

4,000
741

–
690

Provision for directors' retirement benefits
Asset retirement obligations

474
1,191

507
1,424

Total non-current liabilities

6,407

2,622

19,60518,363

Total non-current assets
Total assets
Liabilities
Current liabilities

Total current liabilities
Non-current liabilities

Total liabilities

16

(Millions of yen)
As of February 28, 2014

As of February 28, 2015

Net assets
Shareholders' equity
Capital stock

4,157

4,157

Capital surplus
Legal capital surplus

4,032

4,032

Total capital surpluses

4,032

4,032

Retained earnings
Legal retained earnings

39

39

Other retained earnings
Retained earnings brought forward

27,172

29,680Total retained earnings

27,212

29,719Treasury shares(3,975)(3,947)

Total shareholders' equity

31,42533,962

Subscription rights to shares
Total net assets
Total liabilities and net assets

17

4

–

31,43033,962

51,03552,325

Non-consolidated statements of income(Millions of yen)
Fiscal year ended
February 28, 2014
Net sales
Net sales of goods

Fiscal year ended
February 28, 2015

161,846

Other operating revenue
Total net sales

147,054

6,189

6,117

168,036

153,171

Cost of sales
Cost of goods soldBeginning goods

10,341

9,348

Cost of purchased goods

130,201

120,296

Total

140,543

129,645

9,348

15,355Ending goods
Transfer to other account
Cost of goods sold
sss

58

13

131,136

114,276863

715

132,000

114,992

Gross profit

36,03638,178Selling, general and administrative expenses
Advertising expenses

Total cost of sales

4,924

5,740

Directors' compensations
Salaries and allowances

183
7,921

174
8,546

Bonuses
Provision for bonuses

1,345
422

1,521
419

Legal welfare expenses
ddd

1,427
1,148

1,542
1,419

Traveling and transportation expenses
Communication expenses

1,156
580

1,398
584

Supplies expenses
Depreciation

499
1,349

739
1,621

Rent expenses
Rents

190
4,938

162
5,409

32
–

32
9

Other

3,039

3,814

Total selling, general and administrative expenses

29,16133,137

6,874

5,041

80

20

Dividend income
Reimbursement claims

0
19

1,000
–

www
Reversal of allowance for doubtful accounts

11
53

14
–

Other

20

27

Total non-operating income

185

1,062

Provision for directors' retirement benefits
Provision of allowance for doubtful accounts

Operating income
Non-operating income
Interest income18

(Millions of yen)
Fiscal year ended
February 28, 2014
Non-operating expenses
Interest expenses
Provision of allowance for doubtful accounts
Loss on insurance cancellation

Fiscal year ended
February 28, 2015
63

41

–
–

8
17

Other

8

11

Total non-operating expenses

71

78

6,987

6,024

Other

0

0

Total extraordinary income

00Loss on retirement of non-current assets
Impairment loss

99
52

104
55

LessContractCancelationPenalty
Other

–
24

24
4

Ordinary income
Extraordinary income

Extraordinary losses

Total extraordinary losses

177

188

Income before income taxes

6,810

5,837

Income taxes - current

2,864

1,352

Income taxes - deferred

(254)

393

Total income taxes

2,609

1,746

Net income

4,200

4,091

19

Non-consolidated statements of changes in net assets
Fiscal year ended February 28, 2014
(Millions of yen)
Shareholders' equity
Capital surplus

Balance at beginningof current period
Changes of items
during period
Dividends ofsurplus
Net income
Purchase oftreasury shares
Net changes of
items other thanshareholders' equity
Total changes of
items during period
Balance at end ofcurrent period

Capital
stock

Legal
capitalsurplusTotal
capitalsurplus

4,157

4,032

4,032

Retained earnings
Other
Total Subscript Total net
retained
Treasury sharehold ion rights assets
earnings
Legal
Total
to shares
sharesers'
retained Retained retained
equityearnings earnings earnings
brought
forward39

23,95423,994(3,975)

(983)

(983)

(983)

(983)

4,200

4,200

4,200

4,200

(0)

(0)

(0)

28,208

3

28,211

1

1

–

–

–

–

3,217

3,217

(0)

3,217

1

3,218

4,157

4,032

4,032

39

27,172

27,212(3,975)31,425

4

31,43020

Fiscal year ended February 28, 2015
(Millions of yen)
Shareholders' equity
Capital surplus

Balance at beginningof current period
Changes of items
during period
Dividends ofsurplusTransfer of loss on
disposal of treasury
shares
Net income
Purchase oftreasury shares
Disposal oftreasury shares
Net changes of
items other thanshareholders' equity
Total changes of
items during period
Balance at end ofcurrent period

Capital
stock

Legal
capitalsurplus

OthercapitalsurplusTotal
capitalsurplus

4,157

4,032

–

4,032

11

Retained earnings
Other
Total
retained
Treasuryshareholdearnings
Legal
Total
sharesers'
retained Retained retained
equityearnings earnings earnings
brought
forward
39

11

(11)

(11)

27,212(3,975)31,425(1,571)(1,571)(1,571)

(11)

(11)

–

4,091

4,091

4,091
(0)

(0)

28

17

–

–

–

–

–

2,507

2,507

28

2,536

4,157

4,032

–

4,032

39

29,68029,719(3,947)33,962

Subscript
Total net
ion rights
assetsto shares
Balance at beginningof current period
Changes of items
during period
Dividends ofsurplusTransfer of loss on
disposal of treasury
shares
Net income
Purchase oftreasury shares
Disposal oftreasury shares
Net changes of
items other thanshareholders' equity
Total changes of
items during period
Balance at end ofcurrent period

27,172

4

31,430(1,571)
–
4,091
(0)
17
(4)

(4)

(4)

2,532

–

33,96221

(Changes in Accounting Policies)
Changes in accounting estimate
In order to account for losses on repairs to vehicles with warrantees, the warranty estimate value for the warranty term was recorded based on
past results. However, having accumulated a sufficient amount of actual data related to repairs, we changed the method of calculating estimatesfrom the first quarter of the fiscal year under review, due to our ability to generate more precise estimates.
As a result, compared to the previous method, cost of sales for the fiscal year under review decreased by 666 million yen and operating income,ordinary income, and income before income taxes and minority interests all increased by the equivalent amount.
Changes in Method of Presentation
From the fiscal year under review, “Dividend income” which had been included in “Other” under “Non-operating income” in the previous fiscal
year, has been stated as a separate item in the consolidated financial statements because its monetary amount exceeded ten percent of the total
amount of “Non-operating income.” In order to reflect this change in the method of presentation, “Dividend income” has been reclassified in the
consolidated financial statements for the previous fiscal year.
As a result of the change, the 20 million yen of “Other” under “Non-operating income” in the consolidated statements of income for theprevious fiscal year was reclassified as 0 million yen of “Dividend income” and 20 yen million of “Other.”22