Consolidated Financial Summary under Japanese GAAPFor the year ended March 31, 2021

April 28, 2021
Company Name
Listed Stock Exchange
Securities Code
URL
Representative
Contact Person

AIZAWA SECURITIES CO., LTD.
Tokyo Stock Exchange Section 1
8708
https://www.aizawa.co.jp
Takuya Aizawa, President & Representative Director
Kazuhiro Mashiba, Director & Managing Executive Officer

Scheduled date of annual meeting of shareholders
Scheduled date of filing financial report
Scheduled date of dividend payment
Supporting explanatory documents on financial results
Briefing on financial results

June 25, 2021
June 28, 2021
June 07, 2021
YES
NO
(All figures are rounded off to the nearest million)

1. Consolidated financial summary (From April 1, 2020 to March 31, 2021)(1) Consolidated business results(% represents year-on-year change)

OperatingrevenueYear ended, March 31, 2021
Year ended, March 31, 2020

Net operating
revenue

Operatingprofitmillion yen％

million yen％

16,433
14,18815.8
11.7

16,316
14,07016.0
11.8

Note: Comprehensive income

Ordinary
profitProfit attributable toowners of parent％

million yen％

million yen％

929 267.8
252
―

1,542
1,521

1.4
―

4,538
940

382.6
281.0

million yen

Year ended, March 31, 2021: 10,369 million yen (-% vs same term previous year)
Year ended, March 31, 2020: △2,007 million yen (-% vs same term previous year)

Earnings per share

Diluted earnings per
share

Return on equity

Return on assets

yen

yen

％

％

％

Year ended, March 31, 2021

111.09

―

8.4

1.6

5.7

Year ended, March 31, 2020

22.03

―

1.8

1.8

1.8

Gross profit
margin

Note:

1.
2.

Equity gain (loss) of affiliated companies
As of March 31, 2021: -- million yen
As of March 31, 2020: -- million yen
We have introduced ESOP, and average number of company’s share bought under this program for the period under review are being accounted
under company’s own treasury shares.

(2) Consolidated financial position
Total assets

As of March 31, 2021
As of March 31, 2020
Note: Shareholders' equity
As of March 31, 2021: 57,811 million yen

Net assets

Shareholders'equity ratio

Net assets
per share

million yen

million yen％

yen

107,127
85,134

58,34650,14154.0
58.9

1,444.30
1,182.85

As of March 31, 2020: 50,141 million yen

(3) Consolidated cash flow
Cash flows fromoperating activities

Fiscal year ended 2021
Fiscal year ended 2020

Cash flows frominvesting activities

Cash flows fromfinancing activities

Cash & cash equivalents
at the end of period

million yen

million yen

million yen

million yen△1,6188,818

4,111△3,334△1,783△1,521

16,231
15,162

2．Dividends
Dividend per share

Total annual
dividends

Dividends
payout ratio(Consolidated)

Net assets
dividend ratio(Consolidated)

End of 1Q

End of 2Q

End of 3Q

End of 4Q

Annual
Total

yen

yen

yen

yen

yen

million yen%%

Fiscal year ended 2020

―

11

―

11

22

946

99.9

1.8

Fiscal year ending 2021

―

11

―

21

32

1,303

28.8

2.4

―

―

―

―

―

Fiscal year
(Forecast)ending2022―

3. Earning forecast for the fiscal year ending March 31, 2022 (Consolidated)
The Group operates principally in the financial securities business, and its operating results are likely to be affectedby economic and market fluctuations. Due to such nature of its business and consequential difficulty in predicting its
performance, the group does not disclose the forecast of operating results. Such forecasts may mislead the investors.
Instead of it, as we finalize the financial results, we release the preliminary numbers for the quarterly and yearly
results.
※Notes(1) Important changes in subsidiaries during the term
(Changes pursuant to the subsidiaries that lead to a change in the scope of consolidation)
New: 1 (Ariake Secondary Fund Ⅱ LP)
Exclusion: None

YES(2) Changes in accounting policies, changes in accounting estimates and retrospective restatements
NO1) Changes in accounting policies based on revisions of accounting standard
NO2) Changes in accounting policies other than item 1)above
NO3) Change in accounting estimatesNO4) Retrospective restatements(3) Number of issued shares (Common stock)1) Number of shares issued at the end of the term including treasury shares
As of March 31, 2021: 47,525,649 shares
As of March 31, 2020: 47,525,649 shares
2) Number of treasury shares at the end of the term
As of March 31, 2021: 7,498,290 shares
As of March 31, 2020: 5,135,135 shares
3) Average number of shares outstanding (Cumulative)
As of March 31, 2021: 40,856,070 shares
As of March 31, 2020: 42,690,618 shares

(Reference)
1. Financial summary (From April 1, 2020 to March 31, 2021)(1) Business results(% represents year-on-year change)

OperatingrevenueYear ended, March 31, 2020

OperatingprofitOrdinary
profitProfit attributable toowners of parent％

million yen％

million yen％

million yen％

million yen％

16,152 14.0
14,171 23.4

16,062
14,052

14.3
23.6

976
247

295.1
―

1,576
1,474

6.9
―

4,534
922

391.7
116.9

million yen
Year ended, March 31, 2021

Net operating
revenue

Earnings per share

Diluted earnings per share

yen

yen

Year ended, March 31, 2021

111.00―Year ended, March 31, 2020

21.60

―

Note:
1.

We have introduced ESOP, and average number of company’s share bought under this program for the period under review are being accounted
under company’s own treasury shares.

(2) Consolidated financial position

As of March 31, 2021
As of March 31, 2020
Note: Shareholders' equity
As of March 31, 2021: 57,092 million yen

Net capital
regulation
ratio

Total assets

Net assets

Shareholders'equity ratio

million yen

million yen

％

yen

％

105,682
84,87057,092
49,82554.0
58.7

1,426.32
1,175.40

409.8
472.1

Net assets
per share

As of March 31, 2020: 49,825 million yen※ This quarterly financial summary is not subject to quarterly review procedures by certified public accountants
or audit corporations.
※ Explanation on forecasts
The group operates principally in the financial securities business, and its operating results are likely to be affectedby market fluctuations. Due to such nature of its business and difficulty in predicting its performance, group does
not forecast on business results and dividends. At the end of the term, we release the preliminary numbers, as we
finalize the financial results.

Supporting Materials
Table of contents
1.

Financial results for the year ended March 31, 2021
(1) Explanation of business results ·························································································· 1(2) Explanation of the financial results ····················································································· 2(3) Explanation of cash flows·································································································· 2(4) Explanation on the forecast of consolidated business results ······················································· 22.

Basic approach of selecting accounting standards········································································· 23.

Consolidated financial statements and major notes(1) Consolidated balance sheet ······························································································· 3(2) Consolidated statements of income and comprehensive income statement ········································ 5(3) Consolidated statements of changes in net assets ····································································· 7(4) Consolidated statements of cash flows ·················································································· 9(5) Notes on consolidated financial statements ·········································································· 11(Notes on going concern assumption) ················································································· 11(Additional information) ································································································ 11(Segment information) ·································································································· 17(Per share information) ·································································································· 17(Important subsequent events) ························································································· 18

4.

Supplementary information
Consolidated business results for the year ended March 31, 2021
(1) Commission received ···································································································· 20(2) Net trading income ······································································································· 20(3) Comparative quarterly consolidated statements of income ························································ 21

5.

Financial statements and major notes(1) Balance sheet ·············································································································· 22(2) Statements of income ······································································································ 24

6.

Supplementary information(1) Commissions received ··································································································· 25(2) Net trading income ······································································································· 25(3) Equity trading volume (excluding futures etc.) ······································································ 26(4) Underwriting & distribution activities ················································································ 26(5) Capital adequacy ratio ··································································································· 26(6) Comparative quarterly income statement ·············································································· 27

1. Financial results for the year ended March 31, 2021
(1) Explanation of the business results

For the reporting period, operating revenue increased by 15.8% to 16,433 million yen; operating profit increased
by 267.8% to 929 million yen; ordinary profit increased by 1.4% to 1,542 million yen; and profit attributable toowners of parent increased by 382.6% to 4,538 million yen.
For the year ended March 31, 2021, break-down of business results are as follow;(Percentage indicates a year-on-year change. The same shall apply hereinafter in this section)（Commission received）
For the financial year ended March 2021, Total commissions received increased by 41.7% to 10,401 million yen.
Details are as follow:
1) Brokerage commission
Increased by 45.5% to 7,868 million yen due to increase in the trade value of foreign equities.
2) Commission from underwriting, secondary distribution and solicitation towards professional investors
Declined by 67.7% to 4 million yen due to decline in underwriting of domestic equities.
3) Fee from offering, secondary distribution and solicitation towards professional investors
Increased by 22.9% to 825 million yen due to increase in the sales of mutual funds.
4) Other fees received
Increased by 36.3% to 1,701 million yen due to increase in the handling and incentive fees of Fund Wrap.
（Net trading income）
For the financial year ended March 2021, Net trading income declined by 12.2% to 5,550 million yen. Details
are as follow:
1) Equities
Increased by 10.6% to 4,644 million yen due increase in the trading value of foreign equities OTC trades.
2) Bonds
Declined by 83.3% to 260 million yen due reduced handling of foreign bonds.
3) Others
Increased by 14.6% to 645 million yen due forex trades.
（Net financial income）
Net financial income declined by 18.8% to 316 million yen. Under this category, income declined by 19.9% to407 million yen due decline in income from margin trades, and expenses declined by 23.4% to 90 million yen
due to decline in expenses from margin trades.
（Selling, general and administrative expenses）
Selling, general and administrative expenses increased by 11.4% to 15,386 million yen due to increase inpersonnel expenses.
（Non-operating profit and losses）
Non-operating profit was 612 million yen. Under this category, income were 862 million yen including thedividend income of 498 million yen and profit distributions of 194 million yen. While expenses under thiscategory were 249 million yen including the 212 million yen loss from investment in partnership.
（Extraordinary profit and losses）
Total extraordinary profit was 4,800 million yen. Under this category, income were 5,654 million yen including
the 4,246 million yen gain from sales of non-current assets and 1,336 million yen gain from sale on investment
securities. While losses were 853 million yen including the 806 million yen loss on sales of investment securities.
1(2) Explanation of the financial results(All comparisons in this section (2) are with the end of previous consolidated fiscal year)(Assets)
As of at the end of the period under review, total assets was 107,127 million yen, an increase of 21,992 million
yen. This was due to increase of 5,650 million yen in cash and deposits; 2,462 million yen in margin transaction
assets; 3,865 million yen in rental real-estate and 9,078 million yen in operational investment securities
respectively.
(Liabilities)
As of at the end of the period under review, total liabilities was 48,781 million yen, an increase of 13,788 million
yen. This was due to increase of 1,712 million yen in margin transaction liabilities; 6,586 million yen in deposits
received and 3,162 million yen in deferred tax liabilities respectively.
(Net assets)
As for the period under review, total net assets was 58,346 million yen, an increase of 8,204 million yen.
Under this category, net assets declined by 1,767 million yen due to increase in treasury shares; valuationdifference on available-for-sale securities increased by 5,596 million yen; retained earnings increased by 3,614
million yen.
(3) Explanation of the cash flows

For the financial year ended March 2021, Cash and cash equivalents increased by 1,069 million yen to 16,231
million yen. Details are as follow:(Cash flow from operating activities)
Net cash used in operating activities was 1,618 million yen. This was mainly due to increase in cash deposits andCash segregated as deposits for customers.
(Cash flow from investing activities)
Net cash provided by investing activities was 4,111 million yen. This was mainly due to sale of non-current assets
and purchase in investment securities.
(Cash flow from financing activities)
Net cash provided by investing activities was 1,783 million yen. This was mainly due to purchase of treasury shares.
(4) Explanation on the forecast of consolidated business results

The group operates principally in the financial securities and investments business. In this industry, there exist
uncertainties due to, but not limited, economic and market conditions. Group tries to monitor and calculate
such market risks and its effects on the business results. Due to such nature of its business and consequential
difficulty in predicting its performance, the group does not disclose the forecast of business results. Instead ofit, as we finalize the financial results, we release the preliminary numbers for the quarterly and yearly results.

2. Basic approach of selecting accounting standards
Company uses Japanese GAAP accounting standards to ensure the comparison with previous terms. In regard
to applying the IFRS accounting standards in future, company will take appropriate measures in considerationof various domestic and international situations.

23. Consolidated financial statements and major notes(1) Consolidated balance sheet(million yen)

As ofMarch 31,
2020

As of
March 31,2021

15,63522,08922,089
0
495
996
996
357
13,834
13,418
415
238
236
2
1,184
△0
54,831

16,707
27,74027,739
0
1,117
244
244
817
16,297
15,638
658
163
160
3
1,351
△0
64,440

1,186
267
2,179
858
0
4,492

716
346
913
4,724
―
6,701

―
8
49
58

295
27
49
372

24,451
616
1
768
△85
25,75130,30385,13433,530
1,069
―
1,017
△5
35,612
42,686
107,127

AssetsCurrent assets
Cash and deposit
Cash segregated as deposits
Cash segregated as deposits for customers
Other deposits
Operational investment securities
Trading products
Trading securities and otherTrade date accrual
Margin transaction assets
Loans on margin transactions
Cash collateral pledged for securities borrowing on margin transactions
Advances paid
Advances paid to customers
Other advance payments
Other current assets
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Building (net amount)
Office equipment (net amount)Land
Rental real-estate (net amount)
OthersTotal property, plant and equipment
Intangible assets
Goodwill
Software
OthersTotal intangible assets
Investments and other assets
Investment securities
Net defined benefit asset
Deferred tax assets
OthersAllowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

3

(million yen)

Liabilities
Current liabilities
Trading products
Trading securities and other
Derivatives trading
Margin transaction liabilities
Borrowings on margin transactions
Cash received for securities lending on margin transactions
Loans payable secured by securities
Cash received on debt credit transaction of securities
Deposits received
Deposits from customers
Other deposits
Guarantee deposits received
Short-term loans payable
Income taxes payable
Provision for bonuses
Provision for director bonuses
Other current liabilities
Total current liabilities
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Provision for share based remuneration
Other non-current liabilities
Total non-current liabilities
Reserves under special laws
Reserve for financial instruments transaction liabilities
Total reserves under special laws
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

4

As of
March 31,
2020

As of
March 31,
2021

91
90
1
1,365
391
974
1,218
1,218
18,395
16,297
2,098
5,770
3,795
216
443
21
1,054
32,373

94
85
9
1,861
585
1,276
2,930
2,930
24,982
21,024
3,957
5,482
3,795
994
652
31
1,204
42,029

―
1,988
68
380
2,437

934
5,150
151
369
6,605

181
181
34,992

146
146
48,781

8,000
8,097
31,774△1,58046,291

8,000
8,087
35,388△3,34848,128

4,011
△161
3,850
―
50,141
85,134

9,607
75
9,683
534
58,346
107,127

(2) Consolidated statements of income and comprehensive income statement
Consolidated statements of income (For the year ended March 31, 2021)(million yen)

Operating revenue
Commission received
Net trading income
Financial revenue
OthersTotal operating revenue
Financial expenses
Other operating expenses
Net operating revenue
Selling, general and administrative expenses
Trading related expenses
Personnel expenses
Real estate expenses
Office expenses
Depreciation
Taxes and dues
Provision of allowance for doubtful accounts
OthersTotal selling, general and administrative expenses
Operating profit
Non-operating income
Dividend income
Profit distributions
Gain on investments in partnership
Reversal of allowance for doubtful accounts
Relief grants
OthersTotal non-operating income
Non-operating expenses
Loss on investment in partnership
Settlement expenses
OthersTotal non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on step acquisitions
Reversal of reserve for financial
instruments transaction liabilities
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Loss on sales of investment securities
Loss on valuation of investment securities
Impairment loss
Total extraordinary losses
Profit before income taxes
Income taxes – current
Income taxes – deferred
Total income taxes
ProfitProfit (loss) attributable to non-controlling interests
Profit attributable to owners of parent
5

Year ended March
31, 2020

Year ended March 31,
2021

7,342
6,320
508
17
14,188118―
14,07010,4015,550
407
73
16,43390
26
16,316

2,265
7,631
1,196
1,857
307
250
△0
308
13,817
252

2,431
8,365
1,263
2,135
414
379
△0
395
15,386
929

534
451
263
0
―
51
1,301

498
194
―
0
112
56
862

―
28
3
32
1,521

212
21
15
249
1,542

1
398
―

4,246
1,336
36

0
399

35
5,654

3
―
6
601
2
613
1,307
315
51
367
940
―
940

21
19
806
―
5
853
6,343
1,059
747
1,806
4,536
△1
4,538

Consolidated comprehensive income statement (For the year ended March 31, 2021)(million yen)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Comprehensive income(Description)
Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling owners

6

Year ended March
31, 2020

Year ended March 31,
2021

940

4,536

△ 2,725△ 222△ 2,948△ 2,007

5,596
236
5,833
10,369△ 2,007―

10,3681

(3) Consolidated statements of change in net assets(From April 1, 2019 to March 31, 2020)(million yen)

Total accumulated other comprehensive
incomeShareholder’s equity
Capitalstock

Balanceatthebeginning of current
periodChanges of items
during current period
DividendsofsurplusProfit attributableto owners of parent
Purchaseoftreasury shares
Restricted shares
remuneration
Purchaseoftreasury shares for
ESOP
Disposaloftreasury shares
Disposaloftreasury shares for
ESOP
Change in theownership interestof parent due totransaction with
non-controllingshareholders
Net change initems other thanshareholder’sequityTotal changes of
items during period
Balance at end ofcurrent period

8,000

Capitalsurplus7,863

Retainedearnings

31,952

TreasurysharesValuation

Total accumulated

securities

incomeRemeasurements
Total
difference on
otherof defined
shareholder’savailable-for-salecomprehensive
benefits plan
equity46,827

△988

6,737

61

6,798

Noncontrolling
Total net assetsinterests―

53,626△1,118△1,118△1,118

940

940

940

△397

△397

△397

14

39

39

△332

△332

△332

122

332

332

0

0

0

―

―

24

210

―

△2,725△222△2,948―△2,948

―

234

△178

△592

△536

△2,725△222△2,948―△3,484

8,000

8,097

31,774△1,58046,291

4,011

△161

3,850

―

50,1417

(From April 1, 2020 to March 31, 2021)(million yen)

Total accumulated other comprehensive
incomeShareholder’s equity

Valuation

Capitalstock

CapitalsurplusRetainedearnings

TreasurysharesRemeasurements
Total
difference onof defined
shareholder’savailable-for-salebenefits plan
equitysecurities

Balanceatthebeginning of current
periodChanges of items
during current period
DividendsofsurplusProfit attributableto owners of parent
Purchaseoftreasury shares
Restricted shares
remuneration
Purchaseoftreasury shares for
ESOP
Disposaloftreasury shares
Disposaloftreasury shares for
ESOP
Change in theownership interestof parent due totransaction with
non-controllingshareholders
Net change initems other thanshareholder’sequityTotal changes of
items during period
Balance at end ofcurrent period

8,000

8,097

31,774

46,291△1,580

4,011

△161

Total accumulated
othercomprehensive

Noncontrollinginterests

Total net
assets―50,141income

3,850

△924

△924

△924

4,538

4,538

4,538

△1,797△1,797△1,797

22

46

46

―

―

―

―

―

―

7

7

7

△34

△34

23

―

△34

5,596

236

5,833

534

6,367

―

△10

3,614

△1,767

1,836

5,596

236

5,833

534

8,204

8,000

8,087

35,388△3,34848,128

9,607

75

9,683

534

58,3468

(4) Consolidated statements of cash flows(million yen)

Cash flows from operating activities
Income before income taxes

Year ended
March 31, 2020

Year ended
March 31, 2021

1,307

6,343

Depreciation
Amortization of goodwill

307
―

414
43

Impairment loss
Increase (decrease) in allowance for doubtful accounts

2△0Increase (decrease) in provision for bonuses
Increase(decrease) in provision for director’s bonuses
Increase (decrease) in provision share based
enumeration
Increase (decrease) in net defined benefit assets
Interest and dividend income

127
21

△1
208
9

68

82

△165
△1,047
118

△368
△923
90

△391
601
―

△529
―

2
△263

△4,224212△1,521△5,650547

74

Increase(decrease) in trading products-assets
Increase(decrease) in trade date accrual
Increase (decrease) in operational investment
securities
Increase(decrease) in margin transaction assets

△597
351

△459

△399

160

5,918

△2,462

Increase (decrease) in real-estate rent
Increase (decrease) in the reserve for financial products
transaction liabilities
Increase(decrease) in deposits received△858△3,878

△0

△35

3,725

6,566

Increase(decrease) in trading products-liabilities
Increase(decrease) in margin transaction liabilities

△93
△259
113
0

3
496
△287

Others371△148

Subtotal

7,986△2,150Interest and dividend income received
Interest expenses paid

1,085

922

△119

△98

Income taxes paid
Income taxes (paid) refund

△243
109

△301
9

Net cash provided by (used in) operating activities

8,818△1,618Interest expenses
Loss(gain) on sales of investment securities
Loss(gain) on valuation of investment securities
Loss(gain) on step acquisitions
Loss(gain) on sales of non-current assets
Loss (gain) on investment in partnership
Decrease(increase) in cash segregated as deposits forcustomers
Increase (decrease) in advance paid

Increase(decrease) in loans secured by securities
Increase(decrease) in guarantee deposits received

9

5

△36

751

1,712

(million yen)

Year ended
March 31, 2020

Year ended
March 31, 2021

Payments into time deposits
Proceeds from withdrawal of time deposits

△410
409

△410
408

Purchase of sales of property, plant and equipment
Proceeds from sale of property, plant and equipment

△109
78

△337
5,887

―
△4,189441
593△25△6,558
5,592
327

―

△305

Cash flow from investing activities

Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Proceeds from dividends of investment in partnerships
Purchase of shares of subsidiary resulting in change inscope of consolidation
Payment for guarantee deposits
Proceeds from collection of guarantee deposits
Acquisition of long-term prepaid expenses

△47
107

△414
64

△170

△77

Asset retirement obligations
Others

△33
△3

△48
8

△3,334

4,111

Net cash provided by (used in) investing activities
Cash flows from financing activities
Proceeds from long-term loans payable
Repayments on long-term loans payable
Repayments of lease obligations
Purchase of treasury shares
Proceeds from sales of treasury shares

―

950

―
△0

△15
△1

△729
332

△1,797
7

Cash dividends paid

△1,123△926

Net cash provided by (used in) financing activities△1,521△1,783Difference in cash and cash equivalents

△270

360

Increase (decrease) in cash and cash equivalents

3,692

1,069

Cash and cash equivalents at start of period

11,46915,162

Cash and cash equivalents at end of period

15,162

16,23110

(5) Notes on consolidated financial statements(Notes on going concern assumption)

Not applicable.
(Additional information)
ESOP
The company has introduced an Employee Stock Ownership Plan Trust (“ESOP Trust”) from July 22, 2019with the motive to increase the enterprise value over mid to long term. The Company's stock held by the
ESOP Trust is included in treasury shares under net assets with a book value of 323 million yen for 487
thousand shares as of March 31, 2021.
Sale of non-current assets
At the board of directors meeting held on October 30, 2020, the Company resolved to sell the non-current
assets mentioned below. The share purchase agreement was concluded on November 6, 2020 and thetransfer of assets was concluded on December 15, 2020.
1. Reason for sale of non-current asset
In order to efficiently utilize the resources and strengthen the financial position of company.
2. Details of transaction
Detail of Assets

Current Occupancy

1-20-9, Nihonbashi, Chuo Ku, Tokyo
Land area: 394.11 ㎡
Built up area: 2,228.52 ㎡

Aizawa Building(Still in use as office)1-20-1, Nihonbashi, Chuo Ku, Tokyo
1-20-7, Nihonbashi, Chuo Ku, Tokyo
Land area: 167.70 ㎡
Built up area: 979.83 ㎡

Kabutocho Building(Still in use as office)3. Description of transaction
Due to agreement with the transferee, the company cannot disclose the name of the transferee. There are no
capital tie up relationships, personal relationships, business relationships between the Company and thetransferee.
Company has entered into a rental agreement with the transferee with effect from the transfer date and is
still using the above mentioned assets as office.
4. Dates relating transaction(1) Date of board resolution(2) Date of agreement(3) Date of transfer

October 30, 2020
November 6, 2020
December 15, 2020

5. Impact on company’s financial
Extra ordinary profit of 4,246 million yen from the sales of non-current assets have been booked in thefinancial result for FY2021.

11

(Notes on business combination etc.)
Business combination through acquisition
At the board of directors meeting held on May 20, 2020, the Company resolved to make Asuka AssetManagement co., Ltd., a subsidiary company. The agreement on transfer of holdings was concluded onsame day and transfer of holding was completed on June 02, 2020.
1. Description(1) Name of acquired company and details of its businesses
Name of acquired company
Asuka Asset Management Co., Ltd.
Business details

Type Ⅱ financial business, Investment advisory, Investment
management & Agency business(2) Purpose of business combination
Aizawa Securities Co., Ltd. Group works with management philosophy of "Making life better throughsecurities investment" with the vision of "Hope courier" & "Beyond the securities company" to provide
the asset building services in lieu with the best customer satisfaction.
Asuka Asset Management Co., Ltd. is a pioneer in Japan’s hedge fund industry, specializing in
Alternative investments. As the group is focusing on asset building business, its addition to group withenhanced investment skills and techniques will lead synergies like; offering better products to clients,
enhancement of services for financial institutions and better performance of proprietary investments.
We plan to strengthen our asset building business and services towards financial institutions.
(3) Acquisition dateJune 02, 2020
(4) Acquisition type
Acquired share holdings with cash transaction(5) Name change after acquisition
Aizawa Asset Management Co., Ltd.
Asuka Asset Management Co., Ltd. merged with company’s consolidated subsidiary Akebono AssetManagement Ltd. in an absorption type merger on February 1, 2021 and changed its name to Aizawa
Asset Management Co., Ltd.
(6) Acquired voting rights
100%(7) Main grounds for deciding the acquired company
On the basis of acquisition of shares by the company’ cash.
2. Period of performance of the acquired company included in the consolidated income statement for thecurrent fiscal year
From June 1, 2021 to January 31, 2021
3. Details on the transaction cost
Due to the existence of non-disclosure agreement, we cannot disclose the transaction numbers. The
acquiring cost is less than the 15% of the net assets of the consolidated results of the year ended in March2020.
4. Details on goodwill, depreciation(1) Occurrence of Goodwill amount
79 million yen(2) Reason for occurrence
Acquisition cost exceeded the market value and net assets at the time of the business combination.
(3) Depreciation method & period
3 years straight line depreciation
12

5. Details of inherited Assets & Liabilities as on date of agreement
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities

216 million yen
57 million yen
274 million yen
50 million yen
3 million yen
53 million yen

6. Estimated impact on the consolidated income statement for the current consolidated fiscal year and its
calculation method, assuming that the business combination was completed on the first day of current
consolidated fiscal year.
Details are omitted due to no important impact.
This note has not been verified by auditor.
Business combination through acquisition
At the board of directors meeting held on November 13, 2020, the Company resolved to make Akebono
Asset Management Ltd., a subsidiary company. The agreement on transfer of holdings was concluded on
December 1, 2020, and transfer of holding was completed on December 8, 2020.
1. Description(1) Name of acquired company and details of its businesses
Name of acquired company
Akebono Asset Management Ltd.
Business details

Type Ⅱ financial business, Investment advisory, Investment
management & Agency business(2) Purpose of business combination
Aizawa Securities Co., Ltd. Group works with management philosophy of "Making life better throughsecurities investment" with the vision of "Hope courier" & "Beyond the securities company" to provide
the asset building services in lieu with the best customer satisfaction.
Akebono Asset Management Ltd. is an alternative investment management company specializing inprivate equity, venture capital and less liquid products. With the acquisition of Akebono AssetManagement Ltd., the investment structure will become more diverse and stronger. This will help thegroup in catering the various needs of the investors including the domestic and foreign institutional
investors.
(3) Acquisition date
December 8, 2020
(4) Acquisition type
Acquired share holdings with cash transaction(5) Name change after acquisition
Not applicable(6) Acquired voting rights
73.75%(7) Main grounds for deciding the acquired company
On the basis of acquisition of shares by the company’ cash.
2. Period of performance of the acquired company included in the consolidated income statement for thecurrent fiscal year
From January 1, 2021 to February 28, 2021
13

3. Details on the transaction cost
Due to the existence of non-disclosure agreement, we cannot disclose the transaction numbers. The
acquiring cost is less than the 15% of the net assets of the consolidated results of the year ended in March
2021.
4. Details on goodwill, depreciation(1) Occurrence of Goodwill amount
259 million yen(2) Reason for occurrence
Acquisition cost exceeded the market value and net assets at the time of the business combination.
(3) Depreciation method & period
3 years straight line depreciation
5. Details of inherited Assets & Liabilities as on date of agreement
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities

43 million yen
11 million yen
55 million yen
7 million yen- million yen
7 million yen

6. Estimated impact on the consolidated income statement for the current consolidated fiscal year and its
calculation method, assuming that the business combination was completed on the first day of current
consolidated fiscal year.
Details are omitted due to no important impact.
This note has not been verified by auditor.
Business combination through investment in fund interest
On February 16, 2021, company made an investment in Ariake Secondary Fund Ⅱ LP, an investment
manager to Aizawa Asset Management co., ltd. , a subsidiary of company.
Since the total investment amount of the Fund is equivalent to more than 10/100 of the capital of the Company,
the Fund is a specified subsidiary of the Company.

1. Description(1) Name and details of transaction
Name
Type

Ariake Secondary Fund Ⅱ LP
Investment fund(2) Purpose of business combination
By investing in this fund managed by Aizawa Asset Management Co., Ltd., a consolidated subsidiaryof the Company, it is expected that the efficiency of operations and cooperation among group companies
will be strengthened. By investing in this fund, which acquires domestic and foreign fund interests andunlisted stocks in the secondary market, company can gain discounted investment know-how anddiversification in assets under management.
(3) Transaction dateFebruary 16, 2021
(4) Transaction type
Acquired fund interest in cash transaction(5) Name change after transaction
Not applicable14(6) Acquired fund interest
71.3%(7) Main grounds for deciding the investment
On the basis of acquisition of fund interest by the company’ cash.
2. Period of performance of the transaction included in the consolidated income statement for the current fiscal
year
The transaction has been consolidated only in the balance sheet of the company and not in the income
statement.
3. Details of investment
Investment amount: 9 million USD
4. Details on goodwill, depreciation
Not applicable
5. Details of inherited Assets & Liabilities as on date of agreement
Current assets
1,495 million yen
Non-current assets- million yen
Total assets
1,495 million yen
Current liabilities- million yen
Non-current liabilities- million yen
Total liabilities- million yen
6. Estimated impact on the consolidated income statement for the current consolidated fiscal year and its
calculation method, assuming that the business combination was completed on the first day of current
consolidated fiscal year.
Details are omitted due to no important impact.
This note has not been verified by auditor.
Transaction under common control
Absorption type merger of subsidiary companies and change in nameAt the board of directors meeting held on November 13, 2020, it was resolved that company’s subsidiary,
Asuka Asset Management Co., Ltd., will merge with Akebono Asset Management Ltd. in absorption typemerger. Merger was conducted on February 1, 2021.
1. Purpose of merger
After absorbing Akebono Asset Management Ltd., Asuka asset Management Co., Ltd. will change its nameto Aizawa Asset Management Co., Ltd. The post-merger new company will strive to create an alternative
asset management company that responds to the needs of the investors in Japan and also contribute todiversifying and enhancing the Aizawa Securities Group’s asset building business.
2. Description(1) Names and details of acquired company(Surviving company)
Names of companies involved in the merger
Business details

Asuka Asset Management Co., Ltd.
Type Ⅱ financial business, Investment advisory,
Investment management & Agency business(Absorbed company)
Names of companies involved in the merger
Business details

Akebono Asset Management Ltd.
Type Ⅱ financial business, Investment advisory,
Investment management & Agency business15

(2) Merger dateFebruary 1, 2021

(3) Merger Type
This is an absorption-type merger in which Asuka Asset Management Co., Ltd. is the surviving
company and Akebono Asset Management Ltd. is dissolved.
(4) New shares issued and allotment
Share allocation ratio

Asuka Asset Management Co.,
Ltd. (Surviving company)
1

Akebono Asset Management
Ltd. (Absorbed company)
13.453(5) Inherited Assets/Liabilities
Inherited all the assets, liabilities, rights and obligations of Akebono Asset Management Ltd. with effectfrom the merger date (effective date).
(6) Description of surviving company post-merger
Name
Head office

Aizawa Asset Management Co., Ltd.
1-3-3 Uchisaiwaicho, Uchisiwai Building 6F
Chiyoda-ku, Tokyo
Shinichiro Shiraki, CEO
95 million yen
85.0%
Type Ⅱfinancial business, Investment
advisory, Investment management & Agency
business

Representative
CapitalAcquired voting rights
Business details

3. Accounting practice in regard with this Merger
Scheduled to be processed as transaction of business combinations under common control in lieu with the[Accounting standard for business combinations] (ASBJ Statement No. 21 dated as on January 1, 2019) and[Accounting standard for business combinations and business separations] (ASBJ Statement No. 10 dated
as on January 1, 2019).

16

(Segment information)
Group is operating and conducting financial services mainly in these 4 segments: 1) Trading of stocks 2) Trading andbrokerage of stocks 3) Underwriting and sales of stocks 4) Underwriting and distribution of stocks. Group falls under
the segment of 「Investment/Financial services」as its revenues are generated from above mentioned operational
activities and related other financial services.

(Per share information)

Year ended March 31, 2020

Year ended March 31, 2021

Net assets per share

1,182.85 yen

1,444.30 yen

Net income per share

22.03 yen

111.09 yen(Note)
1)
2)
3)

Diluted profit (loss) per share are not applicable due to non-existence of potential shares outstanding having dilution effect.
Computation of the net income per share is based on following
The shares of the company remaining in the trust recorded as treasury stock in shareholders' equity are included in the treasury stock to
be deducted in the calculation of the average number of shares during the period in the calculation of net income per share. In calculating
net income per share, the average number of treasury stock deducted was 4,835,031 shares in the previous consolidated fiscal year and
6,669,579 shares in the current consolidated fiscal year.

Year ended March 31, 2020 Year ended March 31, 2021

Net income per share
Profit attributable to owners of parent (million yen)
Profit not attributable to common shareholders (million
yen)Profit related to common shareholders attributable toowners of parent (million yen)
Average number of common stock outstanding during
this year (thousands of shares)

17

940

4,538

―

―

940

4,538

42,69040,856

(Important subsequent events)
Purchase of treasury sharesCompany decided to purchase the treasury shares in accordance with the paragraph 1 of article 459, company law.
Decision was taken in the board meeting conducted on February 26, 2021. Company pursued the purchase of its
treasury shares.
1. Minutes of board meeting on purchase of treasury shares(1) Reason for pursuing purchase of treasury shares
To maintain flexible capital policy and increase the capital efficiency and return on equity(2) Details on purchase of treasury shares
1) Share type:
Common share2) Number of treasury shares:
Maximum of 1,500,000 shares (Within 3.7% of outstanding shares
excluding the treasury shares)
3) Value of treasury share:
Maximum of 1,800 million yen
4) Term for purchase:
From March 1, 2021 to February 28, 2022
5) Mode of purchase:
Direct trade through Tokyo Stock Exchange
2. Details on completed purchase of treasury shares
1) Share type:
Common share2) Number of shares:
89,300 shares
3) Value of shares:
89 million yen
4) Buyback term:
From April 1, 2021 to April 22, 2021
5) Mode of purchase:
Direct trade through Tokyo Stock Exchange
In line with above mentioned board decision, the status of purchase of treasury shares as of April 22, 2021
is as follow:
1) Number of treasury shares purchase completed:
324,800 shares
2) Value of treasury shares purchase completed:
327 million yen
Shift to holding company structure through company split/establishment of subsidiary company
At the board of directors meeting held on February 12, 2021, it was resolved to shift to the company to theholding company structure. It was resolved that company will establish two 100% subsidiary preparatorycompanies “AIZAWA SECURITIES DIVISION PREPARATION CO., LTD.” for the purpose of inheriting
the securities brokerage business and “LIFE DESIGN PARTNERS CO., LTD.” for initiating the IFA
business. Both these companies were established on April 1, 2021.
At the board of directors meeting held on February 12, 2021, it was resolved that with effect from October
1, 2021; a) securities brokerage business will be inherited to its subsidiary company “AIZAWASECURITIES DIVISION PREPARATION CO., LTD.”, b) investment business will be inherited to“AIZAWA INVESTMENTS CO., LTD.” Agreements in relation to this absorption type company split
agreement were also concluded on same day.
After the completion of absorption type company split, company plans to change its name to “AIZAWASECURITIES GROUP CO., LTD.” on October 1, 2021. Company also plans to become a company withaudit and supervisory committee in parallel with change to holding company structure. The shift to theholding company structure is subject to approval at the shareholder’s meeting to be held in June, 2021
and fulfillment of necessary registration and approval from the regulators to be done by newly
established subsidiary companies.
1. Purpose of change to holding company structure
Company works with management philosophy of "Making life better through securities investment" withthe vision of "Hope courier" & "Beyond the securities company" to provide the asset building services inlieu with the best customer satisfaction.
The company conducts business in finance industry that has been going through lot of changes and facing
fierce competition. With the COVID 19 pandemics, the traditional sales channels of visiting client’s needsa change, there is a decline in brokerage commission led by online brokers, and lot of new entrants are18

increasing in the securities brokerage business. In such an environment, a stronger organizational structurethat enables appropriate and prompt decision-making and agile business strategy execution is required.
With the change to a holding company structure, company can conduct the business under one umbrella
work on swift decision making, strengthening the financial position, allocating the management resources
and creating the new business opportunities,
Company (including subsidiary and affiliates) have divided the businesses within the group into fourbusinesses: securities business, financial product brokerage business (IFA), asset management business, andinvestment business. With this new group organization structure, group aims to serve as a financial service
provider catering high level service.
2. Details of holding company structure(1) Schedule
Resolution for change in structure at Board of director meeting
Approval of establishment of subsidiary companies at Board of director meeting
Establishment of subsidiary companies
Approval of company split agreement at Board of director meeting
Conclusion of company split agreement
Approval of company split agreement at Ordinary shareholders meeting
Effective date of company split

February 12, 2021
February 12, 2021
April 1, 2021
April 28, 2021
April 28, 2021
June 25, 2021 (planned)
October 01, 2021 (planned)(2) Structure
After conducting the company split, company plans to inherit its securities brokerage business to its
100% subsidiary company “AIZAWA SECURITIES DIVISION PREPARATION CO., LTD” andinherit investment business to its 100% subsidiary company “AIZAWA INVESTMENTS CO., LTD.”
Company will continue its listing at Tokyo Stock Exchange as a holding company.
3. Establishment of subsidiary companies toward the shift to holding company structure
(1)
Name

AIZAWA SECURITIES DIVISION PREPARATION CO., LTD.
(Plan to change name to AIZAWA SECURITIES CO., LTD. from October 1, 2021)

Head office
Representative Name・Title
Business details

1-20-3, Nihonbashi, Chuo-ku
Takuya Aizawa, CEO
Preparation work to inherit securities brokerage business through absorption type
split
300 million yen
April 1, 2021
30,000End of MarchAIZAWA SECURITIES CO., LTD.
Capital relation
Established as 100% subsidiary company
Personnel relation
Appointed directors from the company
Business relation
As the business has not yet started, currently no businessdealing relation exist with the company

CapitalEstablishment date
Shares issued
Fiscal year
Shareholder(s)Relationshipwithcompany

the

(2)
Name
Head office
Representative Name・Title
Business details
CapitalEstablishment date
Shares issued
Fiscal year
Shareholder(s)Relationshipwiththecompany

LIFE DESIGN PARTNERS CO., LTD.
1-20-3, Nihonbashi, Chuo-ku
Yoshikazu Igarashi, CEO
Preparation work to initiate the IFA business30 million yen
April 01, 2021
3,000
End of MarchAIZAWA SECURITIES CO., LTD.
Capital relation
Established as 100% subsidiary company
Personnel relation
Appointed directors from the company
Business relation
As the business has not yet started, currently no businessdealing relation exist with the company
19

4. Supplementary information
Consolidated business results for the year ended March 31, 2021
(1) Commission receivedA) Breakdown of commission received(million yen)

Year ended March 31,
2020
(A)

Year ended March 31,
2021
(B)

Change
(B/A)

5,406
5,271
―
134

7,868
7,753
―
114

145.5%
147.1%
―
85.5%

15

4

32.3%

11
3

3
1

30.1%
39.0%

672

825

122.9%

1,248
7,342

1,701
10,401

136.3%
141.7%

Brokerage commission
Equities
Bonds
Beneficiary securities
Commission from underwriting, secondary distribution
and solicitation towards professional investors
Equities
Bonds
Fee from offering, secondary distribution
solicitation towards professional investors

andOther fees received
Total
B)

Product wise breakdown(million yen)

Year ended March 31,
2020
(A)

EquitiesYear ended March 31,
2021 (B)

5,344

7,819

146.3%

4

1

41.0%

1,492

1,608

107.8%

500

971

193.9%

7,342

10,401141.7%

Bonds
Beneficiary securities
OthersTotal(2)Change(B/A)

Net trading income(million yen)

Year ended March 31,
2020
(A)

Year ended March 31,
2021 (B)

Change(B/A)

Equities etc.

4,197

4,644

110.6%

Bonds, forex etc.
Bonds etc.
Forex etc.
Total

2,122
1,559
563
6,320

906
260
645
5,550

42.7%
16.7%
114.6%
87.8%

20

(3)

Comparative quarterly consolidated statements of income(million yen)

FY 2020

Operating revenue
Commission received
Brokerage commission

FY 2021

1Q
ended

2Q
ended

3Q
ended

4Q
ended

1Q
ended

2Q
ended

3Q
ended

4Q
ended

June 30

Sept.30

Dec.31March 31

June 30

Sept.30

Dec.31March 31

1,783
1,230

1,508
1,086

2,106
1,585

1,943
1,503

2,463
2,052

2,491
1,926

2,564
1,925

2,881
1,964

11

1

0

1

1

1

1

1

196

125

219

130

116

172

209

326

Other fees received
Net trading income
Financial revenue
OthersTotal operating revenue
Financial expenses
Other operating expenses

344
1,611
114
6
3,514
25
―

295
1,738
140
6
3,394
34
―

300
1,312
113
6
3,538
32
―

308
1,658
140
△1
3,741
26
―

293
1,003
96
7
3,571
24
2

391
1,742
110
19
4,364
25
8

428
1,567
100
22
4,255
20
6

588
1,237
99
23
4,241
20
8

Net operating revenue
Selling, general and administrative
expenses
Trading related expenses
Personnel expenses
Real estate expenses
Office expenses
Depreciation
Taxes and dues
Provision of allowance for doubtful
accounts
OthersTotal selling, general and administrative
expenses
Operating profit

3,489

3,360

3,505

3,715

3,543

4,331

4,228

4,212

594
1,898
296
472
78
57

501
1,871
299
437
78
65

591
1,915
304
466
72
59

579
1,946
296
480
78
67

547
1,908
290
495
74
55

625
2,239
306
502
98
92

603
2,133
302
550
97
107

655
2,084
363
587
144
122

△0

△0

△0

△0

0

0

△0

△0

83

78

69

77

73

101

95

124

3,480

3,331

3,478

3,526

3,446

3,966

3,889

4,083

Commission from underwriting,secondary distribution and solicitation
towards professional investors
Fee from offering, secondary distribution
and solicitation towards professional
investors

8

28

27

188

97

364

338

128

328
4

390
△2

250
0

331
29

278
23

208
△13

308
21

65
218

332

421

276

491

353

587

626

△24

1
5

21
0

55
55

321
551

490
118

134
16

4,300
691

728
25

Profit before income taxes

327

441

276

261

724

705

4,234

678

Income tax expenses

34

108

46

178

17

344

1,088

355

ProfitProfit (loss) attributable to noncontrolling interests
Profit attributable to owners of parent

293

333

230

83

707

360

3,146

322

―

―

―

―

―

―

―

△1

293

333

230

83

707

360

3,146

324

Non-operating income
Non-operating expenses
Ordinary profit
Extraordinary income
Extraordinary losses

21

5.

Financial statements and major notes(1) Balance sheet(million yen)

As ofMarch 31,
2020

As of
March 31,2021

15,34922,08922,089
0
996
996
357
13,834
13,418
415
238
236
2
1
314
235
208
280
4
△0
53,911

15,067
27,74027,739
0
244
244
817
16,297
15,638
658
163
160
3
1
277
267
336
382
13
△0
61,608

1,121
267
2,108
―
0
3,498

1,425
346
3,315
100
―
5,186

24
8
22
0
55

24
22
22
0
69

23,124
1,276
440
13
1,000
11
453
214
848
107
△85
27,40530,95984,87031,138
2,581
1,613
13
1,500
9
800
178
960
26
△5
38,81844,073
105,682

AssetsCurrent assets
Cash and deposit
Cash segregated as deposits
Cash segregated as deposits for customers
Other deposits
Trading products
Trading securities and otherTrade date accrual
Margin transaction assets
Loans on margin transactions
Cash collateral pledged for securities borrowing on margin transactions
Advances paid
Advances paid to customers
Other advance payments
Short-term loans receivables
Advance payments
Prepaid expenses
Accounts receivables
Accrued income
Other current assets
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Building (net amount)
Equipment (net amount)
Land
Construction in progress
Others (net amount)
Total property, plant and equipment
Intangible assets
Leasehold right
SoftwareTelephone subscription right
OthersTotal intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries and associates
Other securities of subsidiaries and associates
Investments in capital
Long-term loans receivable from subsidiaries and associates
Long-term loans receivable from employees
Long-term guarantee deposits
Long-term prepaid expenses
Prepaid pension expenses
OthersAllowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
22

(million yen)

Liabilities
Current liabilities
Trading products
Trading securities and other
Derivatives trading
Margin transaction liabilities
Borrowings on margin transactions
Cash received for securities lending on margin transactions
Loans payable secured by securities
Cash received on debt credit transaction of securities
Deposits received
Deposits from customers
Other deposits
Guarantee deposits received
Short-term loans payable
Accounts payable
Accrued expenses
Income taxes payable
Provision for bonuses
Provision for director bonuses
Other current liabilities
Total current liabilities
Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Provision for share based remuneration
Long-term deposits received
Accrued income
Other non-current liabilities
Total non-current liabilities
Reserves under special laws
Reserve for financial instruments transaction liabilities
Total reserves under special laws
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Legal capital reserve
Other capital surplus
Total capital surplus
Retained earnings
Legal reserve for retained earnings
Other retained earnings
Reserve for repair
Reserve for reduction entry of replaced non-current assets
Reserve for reduction entry of replaced land
General reserve
Retained earnings brought forward
Total retained earnings
Treasury shares
Total shareholders' equity
Valuation and translation adjustments
Valuation difference on available-for-sale-securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets
23

As of
March 31,
2020

As of
March 31,
2021

91
90
1
1,365
391
974
1,218
1,218
18,395
16,297
2,098
5,770
3,795
741
230
216
443
21
69
32,359

94
85
9
1,861
585
1,276
2,930
2,930
24,961
21,024
3,937
5,482
3,795
821
316
994
650
31
29
41,968

―
2,058
68
300
37
38
2,503

934
5,037
151
305
32
13
6,476

181
181
35,044146
146
48,590

8,000

8,000

7,863
234
8,097

7,863
258
8,121

3,202

3,202

3,000
―
141
23,0002,147
31,492△1,58046,009

3,000
529
1,270
23,0004,100
35,103△3,34847,876

3,816
3,816
49,82584,8709,215
9,215
57,092
105,682

(2) Statements of income(million yen)

Operating revenue
Commission received
Brokerage commission
Commission from underwriting, secondary distribution
and solicitation towards professional investors
Fee from offering, secondary distribution and solicitation
towards professional investors
Other fees received
Net trading income
Financial revenue
Total operating revenue
Financial expenses
Net operating revenue
Selling, general and administrative expenses
Trading related expenses
Personnel expenses
Real estate expenses
Office expenses
Depreciation
Taxes and dues
Provision of allowance for doubtful accounts
OthersTotal selling, general and administrative expenses
Operating profit
Non-operating income
Real estate rental income
Dividend income
Profit distributions
Gain on investments in partnership
Reversal of allowance for doubtful accounts
Relief grants
OthersTotal non-operating income
Non-operating expenses
Loss on investments in partnership
Settlement expenses
OthersTotal non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Reversal of reserve for financial
instruments transaction liabilities
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on the retirement of non-current assets
Loss on sales of investment securities
Loss on valuation of investment securities
Impairment loss
Total extraordinary losses
Profit before income taxes
Income taxes – current
Income taxes – deferred
Total income taxes
Profit24

Year ended March
31, 2020

Year ended March 31,
2021

7,342
5,406

10,194
7,868

15

4

672

825

1,248
6,320
508
14,171
118
14,052

1,495
5,550
407
16,15290
16,062

2,264
7,618
1,216
1,851
304
243
△0
306
13,805
247

2,426
8,224
1,261
2,100
412
347
△0
313
15,085
976

16
523
443
230
0
―
45
1,259

14
485
183
―
0
112
64
861

―
28
3
32
1,474

223
21
15
260
1,576

1
398

4,246
1,335

0

35

399

5,617

3
―
6
588
2
601
1,273
300
50
350
922

21
19
806
―
5
853
6,341
1,059
747
1,806
4,534

6.

Supplementary information(1) Commissions receivedA) Breakdown of commission received(million yen)

Year ended March 31,
2020
(A)

Year ended March 31,
2021
(B)

Change
(B/A)

5,406
5,271
―
134

7,868
7,753
―
114

145.5%
147.1%
―
85.5%

15

4

32.3%

11
3

3
1

30.1%
39.0%

672

825

122.9%

1,248
7,342

1,495
10,194119.8%
138.8%

Brokerage commission
Equities
Bonds
Beneficiary securities
Commission from underwriting, secondary distribution
and solicitation towards professional investors
Equities
Bonds
Fee from offering, secondary distribution
solicitation towards professional investors

andOther fees received
Total
B)

Product wise breakdown(million yen)

Year ended March 31,
2020
(A)

EquitiesYear ended March 31,
2021
(B)

5,344

7,819

146.3%

4

1

41.0%

1,492

1,608

107.8%

500

764

152.6%

7,342

10,194138.8%

Bonds
Beneficiary securities
OthersTotal(2)Change(B/A)

Net trading income(million yen)

Year ended March 31,
2020
(A)

Year ended March 31,
2021
(B)

Change(B/A)

Equities etc.

4,197

4,644

110.6%

Bonds, forex etc.
Bonds etc.
forex etc.
Total

2,122
1,559
563
6,320

906
260
645
5,550

42.7%
16.7%
114.6%
87.8%

25

(3) Equity trading volume (excluding futures etc.)（million shares, million yen）

Year ended March 31, 2020
(A)

Year ended March 31,
2021
(B)

Number ofsharesNumberof shares

Total

AmountChange(B/A)

AmountNumber ofsharesAmount1,695

1,432,984

1,649

1,839,015

97.3%

128.3%

53

305,10280

350,132

149.0%

114.8%

1,641

1,127,881

1,569

1,488,883

95.6%

132.0%

Client transaction share

96.8%

78.7%

95.1%

81.0%

Exchange participation share

0.12%

0.08%

0.13%

0.09%

Proprietarytransaction
Client transaction

Brokerage commission perstock on client transaction

3.19 yen

4.91 yen(4) Underwriting & distribution activities（million shares, million yen）

Underwriting※

Year ended March
31, 2021(A)(B)

Change(B/A)

Equities

Number of shares

0

0

19.6%

Equities

Amount

154

48

31.6%

Bonds

Face value

999

439

44.0%

Face value

―

―

―

Number of shares

0

0

48.7%

Equities

Amount

921

530

57.5%

Bonds

Face value

12,622

2,999

23.8%

Beneficiary securities

Face value

448,263

533,028118.9%

Commercial Paper & overseas
securities

Face value

―

―

―

Commercial Paper & overseas
securities
Equities

Distribution※

Year ended March
31, 2020

Includes secondary offering and private placements(5) Capital adequacy ratio(million yen)

Year ended March 31,
2020

Basic items

Complementary
items

(A)
Valuation difference on availablefor-sale securities
Reserve for financial products
transaction liabilities
Allowance for doubtful accounts
Total

Deductible assets
Unfixed equity capital(A)+(B)-(C)Market risk
Counterparty risk
Risk items
Basic risk
Total
Capital adequacy ratio

26

45,53747,026

3,816

9,215

181

146

0

0

(B)
(C)

3,997

9,361

13,44622,269(D)

36,08934,118

3,566
731
3,344

4,202
734
3,389

7,643

8,325

472.1%

409.8%(E)(D)/(E)×100

Year ended March
31,2021

(6) Comparative quarterly income statement(million yen)

FY 2020

FY 2021

1Q
ended

2Q
ended

3Q
ended

4Q
ended

1Q
ended

2Q
ended

3Q
ended

4Q
ended

June 30

Sept.30

Dec.31March 31

June 30

Sept.30

Dec.31March 31

1,783
1,230

1,508
1,086

2,106
1,585

1,943
1,503

2,463
2,052

2,425
1,926

2,504
1,925

2,800
1,964

11

1

0

1

1

1

1

1

196

125

219

130

116

172

209

326

Other fees received
Net trading income
Financial revenue
Total operating revenue
Financial expenses

344
1,611
114
3,508
25

295
1,738
140
3,387
34

300
1,312
113
3,531
32

308
1,658
140
3,743
26

293
1,003
96
3,563
24

325
1,742
110
4,279
25

367
1,567
100
4,172
20

508
1,237
99
4,137
20

Net operating revenue
Selling, general and administrative
expenses
Trading related expenses
Personnel expenses
Real estate expenses
Office expenses
Depreciation
Taxes and dues
Provision of allowance for doubtful
accounts
OthersTotal selling, general and administrative
expenses
Operating profit

3,482

3,353

3,498

3,717

3,538

4,254

4,152

4,116

593
1,897
300
471
77
55

501
1,868
304
435
77
63

590
1,910
309
464
71
58

579
1,942
301
479
77
66

547
1,902
295
493
73
53

623
2,203
304
491
97
71

601
2,097
300
538
96
102

653
2,021
360
576
144
119

△0

△0

△0

△0

0

0

△0

△0

82

77

69

77

70

81

74

85

3,478

3,328

3,474

3,523

3,437

3,874

3,811

3,961

3

24

24

193

100

379

340

155

325
4
324

333
△2
360

289
0
313

312
29
476

276
26
349

192
△17
590

304
21
623

88
229
13

1
5

21
0

55
55

321
538

490
118

134
16

4,264
691

728
25

Profit before income taxes

319

380

313

259

721

708

4,195

715

Income tax expenses

31

92

38

187

17

344

1,076

366

Profit

287

288

275

72

703

363

3,118

348

Operating revenue
Commission received
Brokerage commission
Commission from underwriting,secondary distribution and solicitation
towards professional investors
Fee from offering, secondary distribution
and solicitation towards professional
investors

Non-operating income
Non-operating expenses
Ordinary profit
Extraordinary income
Extraordinary losses

27