Summary of Financial Statements for the First Quarter of Fiscal Year Ending April 2016
[Japan GAAP] (Consolidated)
August 26, 2015
Name of listed company:

AIN PHARMACIEZ INC.

Exchange listed on:First Section of Tokyo Stock Exchange and Sapporo Securities Exchange

Code number:

9627

URL:

http://www.ainj.co.jp/

Representative:
Inquiries:

Kiichi Otani, President and Representative Director
Toshihide Mizushima, Senior Managing Director and Chief Director of Administration
TEL: +81-11-814-1000
Date of filing quarterly securities report:
September 14, 2015
Start of dividend payment:–

Supplementary documents for quarterly results:

No

Quarterly results briefing:No(Amounts are rounded down to the nearest million yen.)
1. Consolidated results for the first quarter of fiscal year ending April 30, 2016 (May 1, 2015 to July 31, 2015)(1) Consolidated operating results(Percentage figures show year-on-year changes.)
Profit attributable to
Net sales
Operating income
Ordinary income
owners of parent
Three months ended July 31, 2015
Three months ended July 31, 2014
(Note) Comprehensive income:Million yen%

Million yen%

Million yen%

52,146

20.3

2,710

58.7

2,886

58.1

1,533

52.7

43,3545.2
1,707(28.4)
1,825 (26.6)
Three months ended July 31, 2015:¥1,615 million (+52.3%)
Three months ended July 31, 2014:¥1,060 million (-28.2%)

1,004(33.8)%

Diluted earnings
per share

Earnings
per share
Yen
Three months ended July 31, 2015

Million yen

48.35

Yen
–

Three months ended July 31, 2014
31.67–
* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Earnings per share is calculated bydeeming stock splits to have occurred at the beginning of the previous fiscal year.
(2) Consolidated financial position
Shareholders’equity ratio

Net assets

Total assets

Net assets per
share

Million yen

Million yen%

Yen

As of July 31, 2015

115,413

48,71042.1

1,532.17

As of April 30, 2015

114,149

48,04642.0

1,511.57(Reference) Shareholders’ equity:
As of July 31, 2015: ¥48,581 million
As of April 30, 2015: ¥47,928 million* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Net assets per share is calculated bydeeming stock splits to have occurred at the beginning of the previous fiscal year.
2. Dividends

Year ended April 30, 2015

End of firstquarterYen–

End of second
quarter
Yen
0.00

Dividend per share
End of third
quarter
Yen––
Year ending April 30, 2016
Year ending April 30, 2016
0.00
(forecast)(Note) Revision to the most recently announced dividend forecasts: No–

End of year

Full year

Yen

Yen

30.00

30.00

40.00

40.00

3. Consolidated financial forecasts for the fiscal year ending April 30, 2016 (May 1, 2015 to April 30, 2016)(Percentage figures show year-on-year changes.)
Profit attributable toEarnings
Net sales
Operating income
Ordinary income
owners of parent
per share
Million yen%
Million yen%
Million yen%
Million yen%
Yen
First six
103,670
17.5
5,310
25.5
5,490
23.3
3,060
21.2
96.51
monthsFull year
218,280
16.2
13,40017.0
13,700
17.1
7,230
16.7
228.02(Note) Revision to the most recently announced consolidated financial forecasts: No*Notes(1) Major changes in subsidiaries during the period (changes in specified subsidiaries resulting from changes in scope of
consolidation): No
Newly consolidated: –Excluded: –(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements: Yes(Note) For detail, please refer to “2. Matters concerning summary information (notes) (2) Application of specified
accounting methods for the preparation of quarterly consolidated financial statements” on page 3 of the
Attachment.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions
1) Changes in accounting principles as a result of revisions to accounting standards, etc.:
Yes2) Changes in accounting principles other than 1):
No3) Changes in accounting estimates:
No4) Restatement of revisions:No(Note) For detail, please refer to “2. Matters concerning summary information (notes) (3) Changes in accounting
principles, changes in accounting estimates, and restatement of revisions” on page 3 of the Attachment.
(4) Number of outstanding shares (common stock)1) Number of outstanding
shares (including treasury
As of July 31, 2015
31,888,212 shares As of April 30, 2015
31,888,212 sharesstock):
2) Number of shares held in
As of July 31, 2015
180,595 shares As of April 30, 2015
180,595 shares
treasury:
3) Average number ofThree months ended
Three months ended
31,707,617 shares
31,708,380 sharesshares outstanding:July 31, 2015
July 31, 2014
* On October 1, 2014, the Company conducted a 2-for-1 stock split of common shares. Number of outstanding shares(common stock) is calculated by deeming stock splits to have occurred at the beginning of the previous fiscal year.
*Status of execution of the quarterly review of financial statements
This quarterly financial summary is not subject to the quarterly review procedure based on the Financial Instruments andExchange Act. As of the time of disclosure, this review procedure for quarterly financial statements had not been
completed.
*Statement regarding the proper use of financial forecasts and other special remarks
The above forecasts are calculated based on the information available as of the publication date of this material, and actual
financial results may vary due to change in future economic conditions and others.

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

Contents of the Attachment
1. Qualitative information on consolidated results for the period under review............................................................................ 2(1) Consolidated operating results ........................................................................................................................................... 2(2) Consolidated financial position ........................................................................................................................................... 2(3) Forecast of consolidated financial results and other forward-looking information............................................................... 3
2. Matters concerning summary information (notes) ................................................................................................................... 3(1) Major changes in subsidiaries during the period ................................................................................................................ 3(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements ............... 3(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions .................................. 3
3. Quarterly consolidated financial statements ............................................................................................................................ 4(1) Quarterly consolidated balance sheet ................................................................................................................................ 4(2) Quarterly consolidated statements of income and comprehensive income ........................................................................ 6
Quarterly consolidated statement of income ....................................................................................................................... 6
Quarterly consolidated statement of comprehensive income.............................................................................................. 7(3) Notes on quarterly consolidated financial statements ........................................................................................................ 8(Notes on the premise of a going concern)......................................................................................................................... 8(Notes on significant changes in the amount of shareholders’ equity) .............................................................................. 8(Segment Information, etc.) .............................................................................................................................................. 8

1

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

1. Qualitative information on consolidated results for the period under review(1) Consolidated operating results
During the first three months of the current fiscal year (May 1, 2015 to July 31, 2015), the Japanese economy recoveredat a moderate pace, supported by improvements in corporate earnings and the employment market, as well as signs of a
pickup in consumer spending.
In this economic environment, the AIN PHARMACIEZ Group (the Group) worked to expand its business and increase
earnings. Specifically, the Group opened new dispensing pharmacies and used M&A to expand the business. It also
pushed ahead with the comprehensive development of medical malls and developed its urban drug and cosmetic store
business.
In the first three months of the fiscal year, net sales increased 20.3% year on year to ¥52,146 million, operating income
increased 58.7% to ¥2,710 million, ordinary income increased 58.1% to ¥2,886 million, and profit attributable to owners ofparent increased 52.7% to ¥1,533 million.
Financial results by business segment are as follows.
(Dispensing pharmacy business)
In the dispensing pharmacy business, sales continued to rise at existing dispensing pharmacies, supported by growthin average sales per prescription due to a switch to new medicines.
In order to fulfill the role of dispensing pharmacies at the heart of local communities, the Group is building links withlocal medical service providers, mainly in the area of home-based dispensing, stepping up the integration and continuous
management of drug information using patient medication notebooks and other means, and promoting wider use ofgeneric drugs. The Group is also implementing its pharmacy-led project that reviews and rebuilds all dispensing
processes at each dispensing pharmacy in order to improve efficiency and enhance patient services.
In business development, the Group continued to push ahead with business expansion by opening new dispensing
pharmacies and through M&A deals.
As a result, for the first three months of the fiscal year, the dispensing pharmacy business reported sales and profit
growth with sales rising 20.5% year on year to ¥46,783 million and segment income increasing 53.4% to ¥3,745 million.
During the period under review, the Group opened 11 new dispensing pharmacies, including those acquired throughM&A deals, and closed two pharmacies, resulting in a total of 763.
(Drug and cosmetic store business)
In the drug and cosmetic store business, the market environment remained challenging due to a narrowing competitive
gap between companies in the sector and the emergence of new competitors from sector consolidation and realignmentthat also extends to other business sectors, as well as regulatory changes related to online sales of OTC drugs.
Against this backdrop, the Group continued to open ainz & tulpe urban drug and cosmetic stores, strengthened
merchandise lineups, particularly drug and cosmetics products, and worked to capture inbound demand. As a result,sales at existing drug and cosmetic stores increased year on year.
In June 2015, the Company concluded a deal with Shiseido Co., Ltd. to acquire its wholly owned subsidiary AYURALaboratories Inc. Going forward, the Company will work to progressively develop the AYURA brand by expanding sales
channels, building on the brand’s existing presence in department stores and online with ainz & tulpe stores and otherchannels.
In addition, in July 2015, the Company launched two new proprietary brands – LIPS and HIPS and cocodecica. In thelead up to opening stores selling these brands in the new Le trois beauty retail complex (Chuo Ward, Sapporo), which isdue to open in September 2015, the Company is using various media to run sales promotions to boost the Group’s sales
capabilities in the Sapporo area. .
As a result, for the first three months of the fiscal year, the drug and cosmetic store business reported an increase insales of 15.6% year on year to ¥4,985 million. However, segment loss was ¥124 million, compared with segment incomeof ¥41 million in the same period a year earlier.
In the first quarter of the fiscal year, the Group opened ainz & tulpe MARUI CITY YOKOHAMA (Nishi Ward, Yokohama)and ainz & tulpe SHINJUKU HIGASHIGUCHI (Shinjuku Ward, Tokyo) and closed one suburban-type store, resulting in a
total of 57 cosmetic and drug stores at the end of the first quarter.
(Other businesses)
Net sales and segment loss from other businesses were ¥377 million and ¥127 million, respectively.
(2) Consolidated financial position
The balance of total assets at the end of the first quarter increased by ¥1,263 million from the end of the previous fiscal
2

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

year to ¥115,413 million.
This mainly reflected cash on hand and in banks, an increase in inventories, buildings and structures, land and otherproperty, plant and equipment due to business expansion through new store openings and M&A, as well as a decline in
the balance of other accounts receivable.
The balance of liabilities increased by ¥599 million to ¥66,702 million, mainly reflecting an increase in accounts payable
and a decrease in accrued income taxes.
The balance of short- and long-term debts decreased by ¥1, 103 million to ¥12, 867 million.
Total net assets increased by ¥663 million to ¥48,710 million and the shareholders’ equity ratio improved 0.1
percentage points to 42.1%.
(3) Forecast of consolidated financial results and other forward-looking information
The Group has made no change to its earnings forecasts for the first six months of the fiscal year and for the full fiscal
year, announced on May 27, 2015, in light of earnings trends at new stores and existing stores in the first three months of
the fiscal year and future store opening plans.

2. Matters concerning summary information (notes)(1) Major changes in subsidiaries during the period
There are no applicable matters to be reported.
(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements
Tax expenses were calculated by reasonably estimating the effective tax rate after the application of tax effectaccounting to net income before taxes for the consolidated fiscal year including the first quarter, and multiplying theestimated effective tax rate by income before income taxes for the quarter.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions[Application of accounting standard for business combinations, etc.]
The Company has applied the “Accounting Standard for Business Combinations” (Accounting Standards Board ofJapan (ASBJ) Statement No. 21, September 13, 2013), the “Accounting Standard for Consolidated Financial Statements”(ASBJ Statement No. 22, September 13, 2013) and the “Accounting Standard for Business Divestitures” (ASBJ
Statement No. 7, September 13, 2013) from the first quarter of the current fiscal year. As a result, the accounting method
was changed to record the difference arising from changes in the equity in subsidiaries under ongoing control of theCompany as capital surplus, and acquisition-related costs as expenses for the fiscal year in which they are incurred. In
addition, with respect to any business combination entered into on or after the first day of the first quarter under review,
the accounting method was changed to reflect adjustments to the allocation of acquisition cost under provisional
accounting treatment on the consolidated financial statements of the quarterly financial period in which the relevantbusiness combinations became or will become effective. Furthermore, the presentation method for “net income” waschanged, and references to “minority interests” were changed to “non-controlling interests.” To reflect these changes, theCompany has reclassified its quarterly and full-year consolidated financial statements for the first quarter of the previous
fiscal year and the previous fiscal year.
The Company has applied the Accounting Standard for Business Combinations and the other standards in accordancewith transitional provisions in paragraph 58-2(4) of the Accounting Standard for Business Combinations, paragraph44-5(4) of the Accounting Standard for Consolidated Financial Statements and paragraph 57-4(4) of the AccountingStandard for Business Divestitures, prospectively at the beginning of the first quarter under review.
As a result, during the first three months of the fiscal year, operating income, ordinary income and income before
income taxes each declined by ¥41,968 thousand.

3

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

3. Quarterly consolidated financial statements(1) Quarterly consolidated balance sheet(Thousand yen)

AssetsCurrent assets
Cash on hand and in banks
Notes and accounts receivable
Merchandise
Supplies
Deferred tax assets
Short-term loans
Other accounts receivable
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property, plant and equipment
Buildings and structures, net
Land
Other property, plant and equipment, net
Total property, plant and equipment
Intangible fixed assets
Goodwill
Other intangible fixed assets
Total intangible fixed assets
Investments and other assets
Investments in securities
Deferred tax assets
Deposits and guarantees
Other investments and other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets

4

Fiscal year endedApril 30, 2015
(As of April 30, 2015)

Three months ended
July 31, 2015
(As of July 31, 2015)

19,553,423
8,369,451
9,747,115
162,635
894,440
739,342
5,291,030
1,765,517(157,053)
46,365,901

20,465,316
8,371,458
10,623,102
162,546
912,187749,524
3,717,431
1,576,363(156,273)
46,421,657

11,678,535
7,931,761
2,862,045
22,472,342

11,877,042
8,172,897
3,578,451
23,628,391

26,340,056
1,283,021
27,623,077

25,922,404
1,313,406
27,235,811

2,872,382
984,239
9,710,040
4,644,288(522,385)
17,688,566
67,783,986
114,149,888

2,979,233
994,060
9,714,710
4,961,884(522,385)
18,127,503
68,991,705
115,413,363

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

(Thousand yen)

Liabilities
Current liabilities
Accounts payable
Short-term debt
Accrued income taxes
Deposits received
Allowance for bonuses to employees
Allowance for bonuses to directors
Reserve for reward obligations
Other current liabilities
Total current liabilities
Long-term liabilities
Long-term debt
Net defined benefit liability
Other long-term liabilities
Total long-term liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Unrealized holding gains on securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

5

Fiscal year endedApril 30, 2015
(As of April 30, 2015)

Three months ended
July 31, 2015
(As of July 31, 2015)

31,826,516
6,330,773
2,320,567
9,052,200
1,353,380
11,751
338,824
3,199,345
54,433,358

33,716,809
6,162,556
1,277,575
9,762,666
1,186,646
4,774
338,824
3,428,237
55,878,090

7,640,133
1,636,186
2,393,661
11,669,982
66,103,340

6,704,701
1,647,215
2,472,941
10,824,857
66,702,948

8,682,976
7,872,970
31,639,894(419,311)
47,776,529

8,682,976
7,872,970
32,221,785(419,311)
48,358,420

227,061(75,210)
151,851
118,166
48,046,547
114,149,888

291,851(68,730)
223,120
128,872
48,710,414
115,413,363

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income(Thousand yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Commissions received
Real estate rental revenue
Consignment income
Other non-operating income
Total non-operating income
Non-operating expenses
Interest expenses
Losses on sales of accounts receivables
Real estate rental expenses
Other non-operating expenses
Total non-operating expenses
Ordinary income
Extraordinary income
Gains on sales of fixed assets
Insurance income
Total extraordinary income
Extraordinary losses
Losses on disposal and sales of fixed assets
Impairment losses on investments in securities
Directors’ retirement benefits
Other extraordinary losses
Total extraordinary losses
Income before income taxes
Income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

6

Three months ended
July 31, 2014
(May 1, 2014 to
July 31, 2014)
43,354,567
37,406,339
5,948,228
4,240,549
1,707,678

Three months ended
July 31, 2015
(May 1, 2015 toJuly 31, 2015)
52,146,536
44,330,521
7,816,015
5,105,544
2,710,470

17,46420,506
12,113
19,54737,91281,854
189,400

6,737
21,361
17,60543,36045,255
112,670
246,992

20,68020,995
12,943
17,221
71,8401,825,237

20,105
19,59521,8989,500
71,1002,886,361

－
－
－

762
4,391
5,153

17,396
16,41676,9608,254
119,026
1,706,211
692,681
1,013,529
9,348
1,004,181

71,47679,009－2,719
153,204
2,738,311
1,194,484
1,543,826
10,706
1,533,119

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

Quarterly consolidated statement of comprehensive income(Thousand yen)

ProfitOther comprehensive income
Unrealized holding gains on securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to owners ofparentComprehensive income attributable to non-controllinginterests

7

Three months ended
July 31, 2014
(May 1, 2014 to
July 31, 2014)
1,013,529

Three months ended
July 31, 2015
(May 1, 2015 toJuly 31, 2015)
1,543,826

40,337
6,902
47,2401,060,770

64,7896,479
71,2691,615,095

1,051,421

1,604,389

9,348

10,706AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016(3) Notes on quarterly consolidated financial statements(Notes on the premise of a going concern)
There are no applicable matters to be reported.
(Notes on significant changes in the amount of shareholders’ equity)
There are no applicable matters to be reported.
(Segment Information, etc.)
I Three months ended July 31, 2014 (May 1, 2014 to July 31, 2014)
1. Net sales and income (loss) by reportable segment
Reportable segments(Thousand yen)
Carried onquarterly
Adjustments
consolidated(Note) 1
statements ofincome(Note) 2

Dispensing
pharmacy

Drug andcosmetic store(1) Sales to third parties

38,836,628

4,314,131

203,80743,354,567－

43,354,567(2) Intersegment sales－－

75,97675,976(75,976)－

Total sales

38,836,628

4,314,131

279,784

43,430,544(75,976)

43,354,567

Segment income (loss)

2,441,147

41,585(134,199)

2,348,533(523,295)

1,825,237

Other

Total

Sales

Notes:

1. The adjustment of ¥(523,295) thousand to segment income (loss) includes ¥519,946 thousand in corporate
expenses, ¥25,153 thousand in losses that are not allocated to reportable segments, and ¥(21,804) thousand ineliminations due to intersegment transactions.
Overall group expenses consist mainly of expenses associated with the administrative divisions of the parent
company, such as general affairs and accounting divisions.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

II Three months ended July 31, 2015 (May 1, 2015 to July 31, 2015)
1. Net sales and income (loss) by reportable segment
Reportable segments(Thousand yen)
Carried onquarterly
Adjustments
consolidated(Note) 1
statements ofincome(Note) 2

Dispensing
pharmacy

Drug andcosmetic store(1) Sales to third parties

46,783,003

4,985,685

377,847

52,146,536－

52,146,536(2) Intersegment sales－－

78,042

78,042(78,042)－

Total sales

46,783,003

4,985,685

455,890

52,224,579(78,042)

52,146,536

Segment income (loss)

3,745,637(124,978)(127,526)

3,493,132(606,770)

2,886,361

Other

Total

Sales

Notes:

1. The adjustment of ¥(606,770) thousand to segment income (loss) includes ¥626,622 thousand in corporate
expenses, ¥11,248 thousand in losses that are not allocated to reportable segments, and ¥(31,099) thousand ineliminations due to intersegment transactions.
Overall group expenses consist mainly of expenses associated with the administrative divisions of the parent
8

AIN PHARMACIEZ INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2016

company, such as general affairs and accounting divisions.
2. Segment income (loss) is adjusted with the ordinary income of quarterly consolidated statements of income.
2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]:
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]:
There are no applicable matters to be reported.

9