FinancialResultsফা਋forৠ઴ହ৥ৱમ
FY2019 Q3(April1, 2019 ~ December 31, 2019)ফা‫ع‬ফা

Asahi Holdings, Inc.
These forecast performance figures are based on the information currently available to the company’s management and certain
assumptions judged rational. Accordingly, these might be cases in which actual results materially differ from forecasts of this report.
Copyright © Asahi Holdings, Inc. All rights reserved.

1

Consolidated Financial Results (Year on Year)(JPY in billion)

FY2018Q3FY2019Q3

Forecast forFY2019ͤ1ChangeRevenue

78.4

99.1

+20.7

135.0

Operating Income

9.6

13.9+4.3

19.0

Operating Income
Ratio

12.2%

14.0%

-14.1%

Profit Before Tax

8.9

12.1+3.2

16.7

Profit Attributable toOwners of Parent

6.3

6.4+0.1

9.4

CAPEX

1.6

2.3+0.7

4.8

Depreciation
Expense1.7

2.2+0.4

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OperatingIncome

 FY2019 3Q: 13.9 billion yen (Record high result)
YoY increase of 4.3 billion yen
By Segment
Precious Metals: +3.7 billion yen
Environmental Preservation: +0.4 billion yen
Others: +0.2 billion yen

Profit
Before Tax

 FY2019 3Q: 12.1 billion yen (Record high result)
YoY increase of 3.2 billion yen

ProfitAttributableto Owners ofParentDividend

 FY2019 3Q: 6.4 billion yen
YoY increase of 0.1 billion yen
YoY increase is small compared with that of Profit before
tax (3.2 billion yen)(Due to an impairment loss at Asahi Refining Florida, corporate income
tax charges that accompany the sale of shares of Fuji Medical
Instruments and the revaluation of shares in possession, etc.)

 Dividend policy: Approximately 50% or more of theconsolidated net income
Annual dividend forecast: 130 yen per share
Increase of 10 yen per share from the previous forecast
announced on May 8, 2019
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 Revised FY2019 forecast due to an impairment loss recorded by disposal of gold andsilver refining facilities at Asahi Refining Florida.
 As the performance of the precious metals recycling business and environmental
preservation business remains solid, operating income and profit before tax are
projected to be record high.

ٛ)<)RUHFDVWٜ(JPY in billion)%HIRUHUHYLVLRQ$IWHUUHYLVLRQRevenue

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Profit Before Tax

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Profit Attributable toOwners of Parent

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Transfer of shares of Fuji Medical Instruments Mfg.
 Transfer 60% of all the shares of Fuji Medical Instruments Mfg. Co., Ltd. toJohnson Health Tech Co., Ltd.
 Accelerate brand recognition of Fuji in the global market by collaboration withJohnson Health Tech, which is one of the largest companies in fitness equipment,
and further enhance Fuji’s corporate value with the goal of initial public offeringin several years.
‫ٹ‬Schedule
October 29, 2019:
December 20, 2019:
February 2020:

Conclusion of a basic agreement
Conclusion of a share transfer agreement
Share transfer (scheduled)ͤFuji is classified as discontinued operations from FY2019 Q3 and expected to be excluded from the list of consolidated
subsidiaries from FY2019 Q4 due to loss of control.

Johnson Health Tech. Co., Ltd.
999

Established in 1975, manufacture and sales of fitness equipment, etc.
With 30 subsidiaries and over 300 directly managed stores around the world.
Headquartered in Taichung, Taiwan. Its stock is listed on the Taiwan Stock Exchange.

3Copyright © Asahi Holdings, Inc. All rights reserved.

Segment Change
 Changed the segments from FY2019 Q3 as Fuji is classified as discontinued operations.
 Discontinue “Life & Health” segment, mainly formed by Fuji, and consolidate threesegments into two.
 Concentrate management resources in the Precious Metals business and Environmental
Preservation business in order to further enhance corporate value.

Up to FY2019 Q2

From FY2019 Q3

Precious Metals

Asahi

Precious Metals

Environmental
Preservation

Asahi
Environmental
Preservation

Life & Health

INTER CENTRAL, INC., which comprises the Life & Health segment, is transferred toEnvironmental Preservation as it contributes to the realization of a society conserving energy
through the development and installation of air-conditioning equipment.
Copyright © Asahi Holdings, Inc. All rights reserved.

Segment Results (Q3 Actual Year on Year)(JPY in billion)

FY2018Q3FY2019
Q3

ChangeRevenue

62.4

82.8+20.4

Operating Income

8.7

12.4+3.7

Revenue
Environmental
Preservation Operating Income

14.1

15.3+1.1

2.6

3.0+0.4

Revenue

78.4

99.1+20.7

Operating Income

9.6

13.9+4.3

Precious
MetalsConsolidated

4

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Segment Results (Year on Year)(JPY in billion)

FY2018Actual

FY2019Forecast

ChangeRevenue

87.8

113.0+25.2

Operating Income

12.0

17.1+5.1

Revenue
Environmental
Preservation Operating Income

19.4

21.0+1.6

3.9

4.1+0.2

Revenue

128.7135.0+6.3

Operating Income

14.5

19.0

+4.5

PreciousMetals

Consolidated

Copyright © Asahi Holdings, Inc. All rights reserved.

Segment Results (Precious Metals)
 2019 Q3: Revenue and operating income increased year-on-year as the precious metal recycling
business in Japan, South Korea and Malaysia and refining business in North America grew steadily.
 Full year: Revenue and operating income are expected to significantly increase backed by collection
volume of precious metals exceeding the forecast at the beginning of the period and rising prices ofprecious metals.

Q3
Revenue
OperatingIncomeOperatingIncome Ratio

FY2018FY201962.4

82.8[Revenue](JPY in billion)100.0
80.0
60.0

8.7

12.4

40.0
20.0

13.9%

15.0%0.0

FY2018FY2019[Operating Income]15.0

Full Year

FY2018 Actual

FY2019 Forecast
10.0

Revenue

87.8

113.0
5.0

Operating Income
Operating IncomeRatio

12.0

17.1

13.7%

15.1%
50.0

FY2018FY2019Copyright © Asahi Holdings, Inc. All rights reserved.

Segment Results (Environmental Preservation)
 FY2019 Q3: Revenue and operating income increased from the same period in the previous year on
account of the efforts to develop new business by means of capitalizing on the strengths of each groupcompany and reinforcing sales force to provide services.
 Full year: Revenue and operating income are expected to increase backed by solid market trend.

Q3

FY2018[Revenue]

14.1

15.3

20.0

2.6

3.0

10.0

18.6%

19.8%

0.0

Revenue
OperatingIncome
Operating
Income Ratio

FY2019(JPY in billion)
 

15.0

5.0

FY2018FY2019[Operating Income]
Full Year

FY2018 Actual

FY2019 Forecast

4.0

 

3.0

Revenue

19.4

21.0

Operating Income

3.9

4.1

2.0
1.00.0Operating IncomeRatio

19.8%

19.5%FY2018

FY2019Copyright © Asahi Holdings, Inc. All rights reserved.

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 Increased current assets and current liabilities due to expansion of the financial services inNorth America.
(JPY in billion)

Category

Ended
March 31,
2019

Ended
September
30, 2019

ChangeTotal Assets

160.3

226.6

+66.3

Current
Assets

113.8

188.5

+74.7

Non-current
Assets

46.5

38.1

(8.4)

Total Liabilities

92.5

157.7

+65.3

Current
Liabilities

89.7

153.2

+63.5

Non-current
Liabilities

2.8

4.6

+1.8Total Equity

67.8

68.8+1.0

Main reasons of the change

Trade and otherreceivables +59.7

Impact of the financial
services in NA, and changeof financing instrument

Short-term loans
payable ٔ63.2

Impact of the financial
services in NA, and changeof financing instrument‫پ‬/RQJWHUPORDQVSD\DEOHLQFOXGHGLQQRQFXUUHQWOLDELOLWLHVDVRIWKHHQGRI0DUFKLVWUDQVIHUUHGWRFXUUHQWOLDELOLWLHVIRUDFRPSDULVRQSXUSRVH

6

Copyright © Asahi Holdings, Inc. All rights reserved.

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 Net cash provided by (used in) operating activities is negative due to expansion of thefinancial services in North America.
(JPY in billion)

Items

FY20193Q

Profit before tax

12.1

9.2

Depreciation andamortization

2.2

1.7

Category

Operating CF

Decrease (increase) intrade and other receivables(60.5)

Main reasons of the change(cf.)
FY2018 3Q

Impact of the financial services in NA
and change of financing instrument(26.7)

Others, net(9.6)(6.4)

Subtotal(55.9)(22.1)

(2.1)

(1.7)

Others, net

0.1

(0.0)

Subtotal

(2.0)

(1.7)

Net increase (decrease) inshort-term loans payable

61.0

Others, net

(5.1)

(5.3)

Subtotal

56.0

19.4

Cash and Cash Equivalents

14.1

19.8

Purchase of property, plantand equipment

Investment CF

Financing CF

Impact of the financial services in NA
and change of financing instrument

24.7

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<Ref.> Advanced Trading in North America
Advanced Trading: Some clients of refining business in North America (mainly mining companies) desire early
return of gold, while it generally takes approx. one week to return after arrival of dore (raw material). In order tomeet such demands, we conduct the trade that the clients can promptly receive the gold in exchange for interest
payment based on the term shortened. The risk of becoming bad debts is very limited as we basically return thegold after receiving raw materials.
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AsahiClients(MiningCompanies) (1) Arrival of raw $UULYDORIUDZPDWHULDOVn  $UULYDORIUDZPDWHULDOVIRUPHWDOVIURPRXUFOLHQWV PLQLQJFRPSDQLHV

Financial
Institutionsmaterials⋉Advanceddelivery⋈Loan from banks
or gold loan
⋊Finishing⋋Repayment orreturn of gold   /RDQ$GYDQFHGGHOLYHU\:HJHWn  ORDQVIURPILQDQFLDOLQVWLWXWLRQVWKHQPDNHn  DGYDQFHG
GHOLYHU\WRRXUFOLHQWV PLQLQJFRPSDQLHV   )LQLVKLQJ5HSD\PHQW$SSO\WKHPHWDOWKDWZHn  ILQLVKHGWRn  UHSD\WKHn  ORDQIURPWKHILQDQFLDOLQVWLWXWLRQV

In order to conduct advanced delivery to clients before finishing, procuring gold from outside is needed.
There are two financing instruments as described below and we choose either one of them based on thefinancial market situation at the time of financing.

Financing instruments

Accounting
treatment

Impact on operating income

Loan from Japanese banks andprocurement of gold

Finance costs

No(Impact on profit before tax)

Gold loan from bullion banks

Operating expenses

Yes

7

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<Ref.> Profit Expansion in North America••

While main business of Asahi Refining in North America (“AR”) is the refining of gold and silver on aconsignment basis from mining companies, AR seeks to diversify profit sources by positioning therefining business as a platform.
As a result of an attempt to develop and utilize a low-risk scheme, financial services such as Advanced
Trading have become one of the major profit sources and are expected to expand furtherCarbon
Process

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7UDGLQJ

Refining
Platform&RQVLJQPHQW 6DOHVFinance Service'RZQVWUHDP*UHHQ*ROG

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Trend in Metal Prices (Au, Ag)(Unit: JPY per gram)Gold)<)<)<

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Copyright © Asahi Holdings, Inc. All rights reserved.

Trend in Metal Prices (Pd, Pt)(Unit: JPY per gram)

Palladium)<)<)<Platinum)<)<<)

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Copyright © Asahi Holdings, Inc. All rights reserved.

Trend in Prices (Gold <USD/Toz>, EXC <USD/JPY>)
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Copyright © Asahi Holdings, Inc. All rights reserved.