Disclaimer: This is a Japanese-English translation of the summary of financial statements of the Company produced for your convenience.
Since no auditor audited this report, officially only the Japanese version is assumed to be the summary of financial statements of the Company.
This summary does not constitute any guarantee and will not compensate any losses and/or damage stemming from actions taken based on thesestatements. In the case that there is any discrepancy between the Japanese and English versions, the Japanese version is assumed to be correct.

Consolidated Financial Report
For the First Quarter of Fiscal 2017 Ending March 31, 2017 (Japanese GAAP)
Company Name:Grandy House Corporation
Stock Exchange Listing:
Securities Code:
8999
URL:
Representative:
Hiroyuki Murata, President
Inquiries:
Atsuo Saito, Senior Managing Director
Scheduled date of quarterly securities report filing:
August 9, 2016
Scheduled date of dividend payment commencement:―
Preparation of quarterly supplementary explanatory materials:
None
Quarterly results briefing held:
None

August 8, 2016
Tokyo Stock Exchange
http://www.grandy.co.jp
TEL: +81-28-650-7777(Figures are rounded down to the nearest million yen unless otherwise stated.)

1. Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2017
(April 1, 2016 to June 30, 2016)(1) Consolidated Operating Results
Net Sales(Percentage figures show the year-on-year increase (decrease).)Net Income Attributableto Owners of the Parent
Operating Income
Ordinary Income
Company(¥ million)%(¥ million)%(¥ million)%(¥ million)%

11,101

11.8

827

23.8

859

23.9

557

27.0

9,930

23.5

668

56.7

694

51.2

439

61.6

Three months ended
June 30, 2016
Three months ended
June 30, 2015
Note: Comprehensive income

Three months ended June 30, 2016: ¥559 million (25.2%)
Three months ended June 30, 2015: ¥446 million (69.8%)
Net Income per ShareNet Income per Share(Diluted)(¥)(¥)

Three months ended
June 30, 2016
Three months ended
June 30, 2015

19.38

—

15.26

—

Total Assets(¥ million)
40,56639,545Net Assets(¥ million)
16,894
16,623(2) Consolidated Financial Position

June 30, 2016
March 31, 2016
Reference: Shareholders' equity

Shareholders' Equity Ratio
%
41.2
41.6

Net Assets per Share(¥)
580.13571.58June 30, 2016: ¥16,694 million
March 31, 2016: ¥16,448 million

2. Dividends
1Q-End2Q-End(¥)——

Fiscal 2016
Fiscal 2017
Fiscal 2017 (Forecast)

Annual Dividend per Shares
3Q-End
(¥)
(¥)
0.00
—
0.00

—

Period-End

Total

(¥)
12.00

(¥)
12.00

14.00

14.00

Note: Revisions to the most recently announced forecast of cash dividends in the current quarter: None

3. Consolidated Financial Forecasts for Fiscal 2017 (April 1, 2016 to March 31, 2017)

Net SalesInterim Period
Full Fiscal Year(¥ million)
22,30045,000%
7.9
7.9(Percentage figures show the year-on-year increase (decrease) for each corresponding period.)
Net Income
Attributable toOperating Income
Ordinary Income
Net Income per ShareOwners of the Parent
Company(¥ million)%(¥ million)%(¥ million)
%
(¥)
1,560
14.1
1,600
12.8
970
8.5
33.71
3,150
13.8
3,250
13.5
1,970
13.7
68.46

Note: Revisions to the most recently announced financial forecasts in the current quarter: None* Explanatory notes(1) Changes of important subsidiaries during the period(changes in specified subsidiaries resulting in a change in the scope of consolidation): None
Newly included: —Excluded: —(2) Adoption of specific methods for preparation of the quarterly consolidated financial statements: None
(3) Changes in accounting policies, accounting estimates, and restatements
1) Changes in accounting policies in connection with revision to accounting standards, etc.:
2) Changes in accounting policies other than 1):
3) Changes in accounting estimates:
4) Restatements:(4) Number of shares issued and outstanding (common stock)1) Number of shares issued and outstanding
June 30, 2016as of the period-end (including treasury shares)June 30, 2016
2) Number of treasury shares
Three months
3) Average number of shares issued andended June 30,
outstanding for the period
2016

Yes
None
None
None

30,823,200 shares

March 31, 2016

30,823,200 shares

2,046,245 shares

March 31, 2016
Three months
ended June 30,
2015

2,046,245 shares

28,776,955 shares

28,776,955 shares*

Disclosure concerning the implementation status of quarterly review proceduresThis Quarterly Consolidated Financial Report is exempt from the quarterly review procedures required by the Financial
Instruments and Exchange Act of Japan. At the time of this report's disclosure, the quarterly review process for quarterly
consolidated financial statements under the Financial Instruments and Exchange Act has not been completed.

*

Explanation concerning the appropriate use of forecasts and other special instructions
The forecast data presented in this report are based on currently available information and contain a significant number of
uncertainties. Actual results may differ from forecast data due to changes in business conditions.

Attachment Materials: Table of Contents
1. QUALITATIVE INFORMATION ON FINANCIAL STATEMENTS.................................................................. 2(1) Explanation regarding Operating Results ................................................................................................................ 2(2) Explanation regarding Financial Position ................................................................................................................ 3(3) Explanation regarding Future Prospects including Consolidated Financial Forecasts ............................................ 3
2. MATTERS CONCERNING SUMMARY INFORMATION (Notes) .................................................................... 3(1) Changes of Important Subsidiaries during the Period ............................................................................................. 3(2) Adoption of Specific Methods for Preparation of the Quarterly Consolidated Financial Statements ..................... 3(3) Changes in Accounting Policies, Accounting Estimates, and Restatements ........................................................... 3
3. QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS ........................................................................ 5(1) Quarterly Consolidated Balance Sheets................................................................................................................... 5(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income .............. 7(Quarterly Consolidated Statements of Income) .....................................................................................................7(Quarterly Consolidated Statements of Comprehensive Income)............................................................................8(3) Notes to Quarterly Consolidated Financial Statements ........................................................................................... 9(Notes on Going Concern Assumptions) .................................................................................................................9(Notes on Significant Changes in the Amount of Shareholders' Equity) .................................................................9(Segment and Other Information)............................................................................................................................9―1―

1. QUALITATIVE INFORMATION ON FINANCIAL STATEMENTS(1) Explanation regarding Operating Results
During the three months ended June 30, 2016, the Japanese economy presented expectations for a continued
recovery owing to the improvement in the employment and income conditions, but uncertainty remained due tothe strengthening of the yen and the weakness of the stock market from the beginning of the year and theoutcome of the UK referendum which turned out in favor of leaving the European Union.
In the housing sector, the favorable environment for acquisition of houses continued due to the improvement
in employment and income conditions and the continuation of various support measures to promote homeacquisition, as well as the interest rates on housing loans hitting record lows owing to the introduction of negative
rates by the Bank of Japan. As a result, new housing starts marked an increase compared both to the same period
last year and to the previous quarter.
Under these circumstances, the Grandy House Group positioned the consolidated fiscal year under review,which is the second year of the three-year medium-term business plan (drawn up in 2015), as the most important
year to achieve management targets in the final year, and continued to strive to expand and reinforce businessunder the basic policy of "continuous growth through reinforcing the core operation (new homes)" and"expansion of business through enhancement of the stock business."
With regard to new home sales, a core operation, we actively purchased housing lots in major areas including
the area from southern Ibaraki Prefecture to Kashiwa City, Chiba Prefecture, which is our focus area for businessexpansion, and carried out sales promotion by holding various events mainly at "Grandy Plaza," our hub for
information dissemination. In terms of housing projects, we developed "E.SORA, a sun-blessed home" as our
zero-energy house product, and put "Happiness Forest Tokami" (Utsunomiya City, Tochigi Prefecture) on themarket, which features tightened night-time security, offering safe and comfortable lifestyles with house productswith enhanced security and energy saving and creation features.
Meanwhile, in existing home sales, we worked to build up our property inventory for sale, and opened a newsales office (Yoga, Setagaya Ward, Tokyo) at the end of the previous period to boost sales initiatives in theTokyo Metropolitan area, working to expand our business.
As a result of these factors, the Group's consolidated results for the first quarter of Fiscal 2017 were as
follows. Net sales were ¥11,101 million, up 11.8% from the same period of the previous fiscal year; operating
income rose to ¥827 million, an increase of 23.8% year-on-year; ordinary income was ¥859 million, an increaseof 23.9% year-on-year; and net income attributable to owners of the parent company totaled ¥557 million, an
increase of 27.0% year-on-year.
Results by business segment are presented as follows.
Real Estate Sales
In the new home sales business, we held various sales promotional events and campaigns such as "Golden
Week Stamp Rally" and "Concert for young families" at our "Grandy Plaza" showrooms, which are our hub for
information dissemination, in an effort to further cultivate our market.
Also, in the area between southern Ibaraki Prefecture and Kashiwa City, Chiba Prefecture, which we
designated as a focus area for sales expansion last year, we continued to cover the breadth of the area stretchingalong the Joban Line and Tsukuba Express Line, and worked to enhance our land inventory both in terms ofquantity and quality such as by developing strategic large-scale housing lots.
In terms of new housing lots, we started selling "Happiness Forest Tokami" (35 lots, Utsunomiya City,
Tochigi Prefecture) in April 2016, which features enhanced night-time security with street lamps and gate lamps.
Also, "Grage Garden Kawadamachi" (10 lots, Utsunomiya City, Tochigi Prefecture) and "Solaris Vita
Kashiwashi-Minamimasuo" (12 lots, Kashiwa City, Chiba Prefecture), which are made according to our"E.SORA, a sun-blessed home" specifications, which aim to reduce energy bills to zero, and were put on themarket between the end of the previous period and this period. They proved very popular and were sold out in ashort period of time. As a result, new home sales for the consolidated first quarter came to be 333 homes, up 40
homes from a year earlier.
In existing home sales, we opened a branch in Setagaya Ward, Tokyo in March in the end of the previous
period with a view to reinforcing stock business and expanding sales coverage, and worked to bolster sales
efforts in the Metropolitan area (Tokyo, Saitama, Chiba and Kanagawa). With a view to building up our property
inventory for sale, we aimed to have an inventory of over 100 homes at any time, of which 60 are completed
homes. As a result, existing home sales for the consolidated first quarter came to be 39 homes, up 10 homes froma year earlier.
―2―

As a result of these factors, sales in the real estate sales segment increased 12.5% year-on-year to ¥10,289
million. Segment profit rose to ¥783 million, up 27.8% from the same period of the previous fiscal year.
Construction Material Sales
In the construction material sales segment, while the prices of wood for major pre-cut materials stayed flat,
new housing starts for detached houses marked a year-on-year increase for eight consecutive months until June,and custom-built homes marked a year-on-year increase for five consecutive months. However, small andmedium-sized builders' offices, our main customers, continued to have a tough time due to competition withleading companies.
Under such circumstances, sales of the pre-cut materials segment increased though sales outside the groupdecreased as sales to group companies increased, and thanks to efforts to promote other building materials, but
profit declined owing to the sluggish sales to small and medium-sized builders' offices.
As a result of these initiatives, sales in the construction materials sales segment increased 3.4% year-on-yearto ¥748 million. Segment profit totaled ¥48 million, down 11.5% from a year earlier.
Real Estate Leasing
In the real estate leasing segment, the office market in and around Utsunomiya City, Tochigi Prefecture, is
our main market. While there are not enough prime properties compared to demand and vacancy rate has been
declining in Utsunomiya City, office properties were supplied and attracted attention as to how the market
situation will change. In the parking lot market, competition remained tough between parking lots in the vicinity.
Under such circumstances, as we changed the use of some assets from rental to commercial use last period
and sold one pay-by-the-hour parking lot (Mito City, Ibaraki Prefecture), sales from the segment marked a slightdecrease. In terms of profits, as we carried out major maintenance work such as repairing outer walls of tenantbuildings during the quarter under review, we suffered a significant decrease in profits.
As a result, sales in the real estate leasing segment totaled ¥64 million, down 1.7% from a year earlier.
Segment profit totaled ¥29 million, down 31.8% year-on-year.
(2) Explanation regarding Financial Position
Total consolidated assets as of the end of the first consolidated quarter was ¥40,566 million, up ¥1,021
million from the previous consolidated fiscal year, due mainly to the increase in current assets. This was chiefly
due to the increase in inventory of property for sale (including houses under construction) as we endeavored toboost and expand real estate business.
Total liabilities increased ¥750 million to ¥23,672 million. This is mainly due to the increase in long-term andshort-term loans payable and accounts payable for construction contracts caused by the acquisition of properties
for sale as well as funding a number of projects.
Total net assets stood at ¥16,894 million as of June 30, 2016, up ¥271 million compared with the end of theprevious fiscal year. The main reasons are payments of dividends to shareholders and the acquisition of net
income attributable to owners of the parent company.
(3) Explanation regarding Future Prospects including Consolidated Financial Forecasts
There is no change to financial forecasts announced on May 9, 2016.
2. MATTERS CONCERNING SUMMARY INFORMATION (Notes)(1) Changes of Important Subsidiaries during the Period
Not applicable.
(2) Adoption of Specific Methods for Preparation of the Quarterly Consolidated Financial Statements
Not applicable.
(3) Changes in Accounting Policies, Accounting Estimates, and Restatements(Changes in accounting policies)(Application of "Revised Implementation Guidance on Recoverability of Deferred Tax Assets")―3―

We have applied "Revised Implementation Guidance on Recoverability of Deferred Tax Assets" (ASBJ
Guidance No. 26, March 28, 2016) (hereinafter, the "Recoverability Implementation Guidance") from thefirst quarter ended June 30, 2016 and partially revised the accounting method of recoverability of deferred tax
assets.
The Recoverability Implementation Guidance has been applied in accordance with the transitional
treatment set forth in Article 49-4 of the Recoverability Implementation Guidance. The differences between(i) the amounts of deferred tax assets and deferred tax liabilities when provisions applicable from paragraphs
1 to 3 of Article 49-3 of the Recoverability Implementation Guidance were applied as of April 1, 2016, and(ii) the amounts of deferred tax assets and deferred tax liabilities at the end of the fiscal year ended March 31,
2016, were added to Retained Earnings as of April 1, 2016.
As a result, Deferred Tax Assets (investments and other assets) and Retained Earnings increased by¥31,883 thousand as of April 1, 2016.
(Application of Practical Solution on a change in depreciation method due to Tax Reform 2016)
Pursuant to the revised Corporation Tax Law, we have applied "Practical Solution on a change indepreciation method due to Tax Reform 2016" (Practical Issues Task Force No. 32, June 17, 2016) starting in
the consolidated first quarter under review. Accordingly, we have changed the depreciation method applied tostructures which were acquired on or later than April 1, 2016 from the declining balance method to thestraight line method.
As a result, the operating income, ordinary income, and net income before income taxes have eachincreased by ¥108 thousand.

―4―3. QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS(1) Quarterly Consolidated Balance Sheets(Thousands of Yen)FY2016(As of March 31, 2016)

First Quarter of FY2017(As of June 30, 2016)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable – trade
Real estate for sale
Costs on uncompleted construction contracts
Real estate for sale in process

7,789,687

8,241,395

523,636

565,017

11,423,421

10,712,099

10,5397,538

7,996,211

8,927,171

Merchandise and finished goods

206,665

196,363

Raw materials and supplies

115,304

106,884

Deferred tax assets

130,226

102,513

Other

955,924

1,298,349

Allowance for doubtful accounts(3,588)(4,653)29,148,028

30,152,679

3,123,508

3,088,202

11,457

10,611

Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Tools, furniture and fixtures, net
Land
Lease assets, net
Construction in progress
Total property, plant and equipment
Intangible assets

56,696

66,5105,599,701

5,599,789

76,55971,147

148,441

148,441

9,016,365

8,984,702

66,44764,150889,407891,336

Investments and other assets
Investment securities
Long-term loans receivable

20,446

20,174

Deferred tax assets

160,847

203,295

Other

260,837

271,168

Allowance for doubtful accounts(17,279)(21,177)

Total investments and other assets

1,314,260

1,364,796

10,397,072

10,413,649

39,545,100

40,566,328

Total non-current assets
Total assets―5―

(Thousands of Yen)FY2016(As of March 31, 2016)

First Quarter of FY2017(As of June 30, 2016)

Liabilities
Current liabilities
Accounts payable for construction contracts

3,054,103

3,217,323

Short-term loans payable

16,014,500

16,298,000

Current portion of long-term loans payable

382,592

437,912Current portion of bonds

21,00021,000

Lease obligations

41,21440,794

Income taxes payable

566,028

222,628

Provision for warranties for completed construction

54,94056,404

Other694,477

1,026,184

20,828,856

21,320,247

108,000

97,500Total current liabilities
Non-current liabilities
Bonds payable
Long-term loans payable

1,358,183

1,604,688

Lease obligations

39,13933,525

Provision for directors' retirement benefits

100,979

108,504

Net defined benefit liability

428,790449,674

Asset retirement obligations

4,203

4,214

Other
Total non-current liabilities
Total liabilities

53,69053,7132,092,985

2,351,821

22,921,841

23,672,068

2,077,500

2,077,500

Net assets
Shareholders' equity
Capital stock
Capital surplus

2,205,165

2,205,165

Retained earnings

12,551,499

12,795,762

Treasury shares
Total shareholders' equity(351,831)(351,831)

16,482,333

16,726,596

Accumulated other comprehensive income
Valuation difference on available-for-sale securities(34,074)(32,336)

Total accumulated other comprehensive income(34,074)(32,336)

175,000

200,000

16,623,258

16,894,260

39,545,100

40,566,328

Subscription rights to shares
Total net assets
Total liabilities and net assets―6―

(2) Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income(Quarterly Consolidated Statements of Income)(Thousands of Yen)
Three months ended June30, 2015(From April 1, 2015 to June30, 2015)

Three months ended June30, 2016(From April 1, 2016 to June30, 2016)

Net sales

9,930,898

11,101,904

Cost of sales

8,201,427

9,099,539

Gross profit

1,729,471

2,002,364

Selling, general and administrative expenses

1,061,289

1,175,246

668,181827,118

Operating income
Non-operating income
Interest income

161

331

Dividends income

2,455

2,454

Operations consignment fee

54,48058,940

Office work fee

34,39439,911

Other

7,066

7,563

Total non-operating income

98,557109,20272,72075,343Non-operating expenses
Interest expenses
Commission for syndicate loan

–

1,125

Total non-operating expenses

72,72076,468694,018

859,852

Loss on retirement of non-current assets

2,066

4,660

Loss on cancellation of lease contracts–

45

Ordinary income
Extraordinary loss

Total extraordinary loss

2,066

4,705

Net income before income taxes

691,952

855,146

Income taxes–current

236,496

281,057

Income taxes–deferred

16,393

16,386

Total income taxes

252,890

297,443

Net income

439,061

557,702

Net income attributable to non-controlling interests
Net income attributable to owners of the parent company

―7―

–

–

439,061

557,702

(Quarterly Consolidated Statements of Comprehensive Income)(Thousands of Yen)
Three months ended June30, 2015(From April 1, 2015 to June30, 2015)
Net income

Three months ended June30, 2016(From April 1, 2016 to June30, 2016)

439,061

557,702

Valuation difference on available-for-sale securities

7,813

1,738

Total other comprehensive income

7,813

1,738

446,875

559,441446,875

559,441––

Other comprehensive income

Comprehensive income
Comprehensive income attributable to:Comprehensive income attributable to owners of the parent
company
Comprehensive income attributable to non-controllinginterests―8―

(3) Notes to Quarterly Consolidated Financial Statements(Notes on Going Concern Assumptions)Not applicable.
(Notes on Significant Changes in the Amount of Shareholders' Equity)
Not applicable.
(Segment and Other Information)
Segment Information
I. The three months ended June 30, 2015 (April 1, 2015 to June 30, 2015)
1. Information relating to the amounts of net sales, profit and loss by reportable segment
Reportable Segment

Net sales
Sales to outside
customers
Intersegment sales
and transfers
Total
Segment profit

Adjustments(Note 1)(Thousands of Yen)
AmountRecorded on
Quarterly
Consolidated
Statements ofIncome (Note 2)

Real Estate
Sales

Construction
Material Sales

Real Estate
Leasing

9,142,369

723,333

65,1949,930,898—

9,930,898—

808,714

20,373829,088(829,088)—

9,142,369
613,174

1,532,048
54,32485,56843,12010,759,986
710,619(829,088)

9,930,898
694,018

Total(16,601)

Notes: 1 Adjustments of segment profit (−¥16,601 thousand) are eliminations of intersegment transactions.
2 Segment profit has been adjusted to ordinary income described in quarterly consolidated statements of income.

2. Information concerning the impairment loss of non-current assets and goodwill by reportable segment
Not applicable.
II. The three months ended June 30, 2016 (April 1, 2016 to June 30, 2016)
1. Information relating to the amounts of net sales, profit and loss by reportable segment
Reportable Segment

Net sales
Sales to outside
customers
Intersegment sales
and transfers
Total
Segment profit

Adjustments(Note 1)(Thousands of Yen)
AmountRecorded on
Quarterly
Consolidated
Statements ofIncome (Note 2)

Real Estate
Sales

Construction
Material Sales

Real Estate
Leasing

10,289,570

748,240

64,094

11,101,904—

11,101,904—

867,425

20,639888,065(888,065)—

10,289,570
783,941

1,615,666
48,096

84,73329,398

11,989,970
861,436(888,065)

11,101,904
859,852

Total(1,584)

Notes: 1 Adjustments of segment profit (−¥1,584 thousand) are eliminations of intersegment transactions.
2 Segment profit has been adjusted to ordinary income described in quarterly consolidated statements of income.

2. Information concerning the impairment loss of non-current assets and goodwill by reportable segment
Not applicable.

―9―