Consolidated Financial Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019
(April 1, 2018 through December 31, 2018)(Prepared pursuant to Japanese GAAP)All financial information has been prepared in accord with accounting principles generally accepted in Japan.
This is a partial English translation of the original Japanese-language document. All information pertains toconsolidated results unless otherwise noted. Information on the basis of presentation of consolidated financial
statements does not appear in this translation.
February 4, 2019
Company name:
Stock exchange listings:
Stock code:
URL:
Representative:
Contact:
Phone:TIS Inc.
The First Section of the Tokyo Stock Exchange3626
http://www.tis.com/
Toru Kuwano, Chairman and President
Tsuneyoshi Ito, Department Manager of Finance & Accounting Dept., Corporate
Planning SBU.
+81 3-5337-4569

Scheduled dates
Submission of quarterly report:
Commencement of dividend payments:

February 12, 2019-

Supplementary materials to the quarterly results:
Quarterly results presentation held:

Available
Yes (targeted at institutional investors and analysts)

Figures in millions of yen are rounded down to the nearest million
1. Consolidated Results for the First Three Quarters of the Fiscal Year Ending March 31, 2019
(April 1, 2018 – December 31, 2018)(1) Consolidated Financial Results
Percentages indicate year-over-year changes
Net income
attributable to
Net sales
Operating income
Recurring profit
owners of theparent company
millions of yen%

millions of yen%

millions of yen%

millions of yen%

302,961
289,0214.8
3.0

25,022
20,69620.9
29.9

25,516
20,95521.8
30.1

16,97913,46026.1
19.6

First Three Qtrs., FY2019First Three Qtrs., FY2018

Note: Comprehensive income: First Three Qtrs., FY 2019 5,707 million yen (-77.2%), First Three Qtrs., FY 2018: 25,083 million yen (69.5%)

Net income
per share –basic

Net income
per share –dilutedYenFirst Three Qtrs., FY2019First Three Qtrs., FY2018

yen

200.64
157.47-(2) Consolidated Financial Position
Total assets
End of Third Quarter, FY2019
End of FY2018

Net assets

Equity ratio

millions of yen

millions of yen%

344,397
366,954

223,855
226,298

63.6
60.4

For reference: Total equity: End of Third Quarter, FY2019: 219,017 million yen End of FY2018: 221,634 million yen.
*Total equity = Shareholders’ equity plus total accumulated other comprehensive income

2. Cash Dividends for Shareholders of Common Stock
Cash dividends per share
Record date End-Q1 End-Q2 End-Q3 Year-end
or period
FY2018FY2019FY2019(forecast)

yen

-

yen

14.00
20.00

yen

-

yen

Total
yen

26.00

40.00

40.00

60.00

Note: Revisions from the latest release of dividends forecasts: None

3. Forecast of Consolidated Results for FY2019 (April 1, 2018 – March 31, 2019)
Percentages indicate year-over-year changes
Net income
attributable to Net income per
OperatingRecurring profit
Net sales
owners of theshare – basic
incomeparent company
Full FY2019(year ending Mar. 31,
2019)millions of yen%

millions of yen%

millions of yen%

millions of yen%

Yen

414,000

2.1

35,0006.9

35,5008.2

23,30013.0

275.51

Note: Revisions from the latest release of earnings forecasts: None

※ Notes(1) Material reclassifications of subsidiaries during the period: None
(Changes in specified subsidiaries resulting in change in scope of consolidation)
Additions: None
Exclusions: None
(2) Accounting methods specific to quarterly consolidated financial statements: None
(3) Changes in accounting policy, changes in accounting estimates, and retrospective restatement
1) Changes in accordance with amendments to accounting standards, etc.: None
2) Changes other than noted in 1) above: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None
(4) Common stock issued
1) Issued shares as of period-end (including treasury stock):End- Third Quarter, FY2019 (December 31, 2018): 87,789,098 shares
End-FY2018 (March 31, 2018):
87,789,098 shares
2) Treasury stock as of period-end:
End- Third Quarter, FY2019 (December 31, 2018):
3,385,514 shares
End-FY2018 (March 31, 2018):
2,613,034 shares
3) Average number of shares (during the respective nine-month period):First Three Qtrs, FY2019 (ended December 31, 2018): 84,627,327 sharesFirst Three Qtrs, FY2018 (ended December 31, 2017): 85,482,158 shares
Note: Treasury stock includes the number of the Company's own shares held by TIS INTEC Group
Employees’ Shareholding Association Trust and the Board Incentive Plan (BIP) Trust.
*Quarterly review status
These materials are not subject to the quarterly review procedures to be conducted by certified public
accountants or an audit firm.
Caution on Forward-Looking Statements and Other Important Matters
This report contains forward-looking statements that reflect TIS Inc. (“TIS”)’s plans and expectations based on
information available to TIS at the time of preparation and on certain other information TIS believes to bereasonable. These forward-looking statements are not guarantees of future performance, and actual results,
performance, achievements or financial position may differ materially from those expressed or implied herein
due to a range of factors.
For the assumptions underlying the forecasts herein and other notice on the use of earnings forecasts, refer to“(3) Consolidated Earnings Forecast and Caution on Forward-Looking Statements” in the “1. Results ofOperations” section on page 8 in the Accompanying Materials.

Accompanying Materials – Contents
1. Results of Operations

2(1) Analysis of Consolidated Operating Results

2(2) Analysis of Financial Condition

7(3) Consolidated Earnings Forecast and Caution on Forward-Looking Statements

8

2. Consolidated Financial Statements

9(1) Consolidated Balance Sheets

9(2) Consolidated Statements of Income and Comprehensive Income

11

Consolidated Statements of Income
For the First Three Quarters

11

Consolidated Statements of Comprehensive Income
For the First Three Quarters

12(3) Notes on the Consolidated Financial Statements

13(Notes on the Going-concern Assumption)

13(Notes on Significant Changes in the Amount of Shareholders’ Equity)

13(Additional Information)

13

3. Other Information

13

-1-

1. Results of Operations(1) Analysis of Consolidated Operating Results
In the first nine months of fiscal 2019 (April 1, 2018 ~ December 31, 2018), the Japanese economy
continued a moderate recovery owing to high corporate earnings and an improvement in employment
conditions. Looking ahead, the economy is expected to continue its moderate recovery, but it will benecessary to monitor the impact of uncertainties surrounding the global economy, including trade issues,and financial and capital market fluctuations.
The business environment surrounding the IT services industry, to which the TIS INTEC Group belongs,
was robust during the period. The Bank of Japan’s Short-term Economic Survey of Enterprises in Japan(December 2018) showed a 6.4% year-on-year increase in company software investment plans (allmanufacturing & financial institutions), reflecting a strong trend for increased IT investment bycompanies embracing digital management and aiming to realize their business strategies through theaggressive application of IT.
In this environment, the TIS INTEC Group promoted various measures to achieve a speedy structuraltransformation and raise corporate value under a new three-year medium-term management plan launchedat the start of the current fiscal year. The new three-year plan will build the foundation from which theGroup will work to realize its Group Vision 2026.
Consolidated net sales for the Group in the first nine months of fiscal 2019 increased 4.8% year on
year to ¥302,961 million. Operating income rose 20.9% to ¥25,022 million, recurring profit grew 21.8%
to ¥25,516 million, and net income attributable to owners of the parent company expanded 26.1% to¥16,979 million.
The increase in consolidated net sales was driven by the Group’s ability to accurately grasp the IT
investment needs of its customers in areas where IT investment is growing. The increase in operating
income reflects the higher sales and improvements in the gross profit ratio, which rose 1.7 percentage
points year-on-year to 21.9% boosting gross profit and offsetting an increase in selling, general andadministrative expenses primarily related to expenditures targeted at strengthening the Group’s efforts toachieve structural reforms, and the operating income ratio improved 1.1 percentage points to 8.3%. The
growth in recurring profit primarily reflects the growth in operating income. The year-on-year growth innet income attributable to owners of the parent company reflects the positive flow from the above factors
and an improvement in net extraordinary income/loss. The consolidated results for the first nine monthsof fiscal 2019 include extraordinary income of ¥14,360 million and extraordinary losses totaling ¥13,247
million. The main components of these two figures, as reported in our September 27 press release “NoticeRegarding Booking of Extraordinary Loss and Extraordinary Income”, are a ¥10,056 million
extraordinary gain on the sale of investment securities and a ¥8,800 million extraordinary expense related
to data center migration.
In August 2018, TIS Inc. was selected as a constituent stock of the JPX-Nikkei Index 400, which iscomposed of “companies with high appeal for investors, which meet requirements of global investment
standards, such as efficient use of capital and investor-focused management perspectives.”

Segment results for the period are as follows. Following changes to the Group’s management
structure for the purpose of accelerating the ongoing structural transformation, reporting business-2-

segments have been realigned and changed, effective from the start of the first quarter of fiscal 2019. The
sales figures for each segment include inter-segment sales. Year-on-year percent changes are based on
calculations of previous-year results that reflect the new segmentation.

1) Service IT BusinessThis segment comprises Group businesses providing knowledge-intensive IT services that leverage TIS’s
service and industry know-how to create universalized, template-oriented solutions for its customers(includes default configuration and ERP).
Segment sales in the first nine months of fiscal 2019 totaled ¥84,146 million, up 17.1% year on year,
and operating income increased 4.8% to ¥5,258 million. Expansion of settlement-related business andstrong demand for ERP updates contributed to strong sales growth, which offset spending on
forward-looking investment to strengthen the business, thus enabling the segment to post growth in sales
and profits. The segment’s operating income ratio for the first nine months of the fiscal year was 6.2%,
0.7 percentage points below the ratio recorded a year earlier. The decline primarily reflects increased
spending related to forward-looking investments targeted at strengthening the business.
2) BPOThis segment comprises businesses that leverage the Group’s extensive service menu and IT know-how
to deliver business process outsourcing (BPO) services, including marketing and sales services and officeand contract operations.
Segment sales in the first nine months of the fiscal year totaled ¥27,736 million, down 0.9% year on
year. However, operating income expanded 25.5% to ¥1,354 million. With sales stable and broadly in linewith the previous year, the increase in operating income reflects the BPO business’s initiatives to improve
profitability, such as its successful effort to improve transaction margins. As a result, the segment’s
operating income ratio increased 1.0 percentage points to 4.9%.
3) Financial IT BusinessThis segment comprises businesses that leverage business and operating know-how specific to thefinancial sector to raise the value-added of clients’ operations, expand their use of IT, and provide support
to operations using IT.
Segment sales in the first nine months of the fiscal year totaled ¥77,953 million, up 2.4% year on year,
and operating income expanded 15.7% to ¥8,989 million. The increases in sales and profits were driven
by the expansion in IT investment, primarily centered on credit card-related IT, by our core client base.
As a result, the segment operating income ratio expanded 1.3 percentage points to 11.5%.
4) Industrial IT BusinessThis segment’s businesses leverage business and operating know-how specific to non-finance industries
to raise the value-added of clients’ operations, expand their use of IT, and provide support to operations
using IT.
Segment sales in the first nine months of the fiscal year totaled ¥133,470 million, up 6.6% year on
year, and operating income expanded 43.7% to ¥9,226 million. The increases in sales and profits were
driven by expanding IT investment by customers in a wide range of industrial sectors, including-3-

energy-related sectors. As a result, the segment operating income ratio expanded 1.8 percentage points to
6.9%.

5) Other
The Other segment includes a number of ancillary businesses that provide leasing and other information
systems to clients.
Segment sales in the first nine months of the fiscal year totaled ¥6,800 million, down 13.8% year on
year. Segment operating income fell 6.2% to ¥719 million, while the operating profit ratio improved 0.9
percentage points to 10.6%. These results primarily reflect the absorption merger of IT Service Force Inc.,a wholly owned subsidiary responsible for the TIS INTEC Group’s shared services, and inclusion of thatbusiness’s results in the Other segment from the second quarter of the current fiscal year.
As noted above, the TIS INTEC Group embarked on a new three-year medium-term management
plan from the start of this fiscal year. The new plan will build the foundation from which the Group will
work to realize its Group Vision 2026. By striving to fulfill the new plan’s five basic
policies—“Sustainable profit growth”, “Emphasis on employee self-fulfillment”, “Concentrate on corebusinesses”; “Shift to prior investment style of business development”, and “Expand global
business”—we aim to achieve a speedy structural transformation and raise corporate value.
Fiscal 2019 is the first year of the new medium-term management plan. The Group has formulated thefollowing management strategy for the plan’s initial year and is energetically implementing measures toaccomplish the strategy.
Group Management Policies for Fiscal 2019
1) Charge forward on switch to service-style business
2) Robust prior investment to create new services
3) Added-value and productivity improvements in domains of expertise
4) Promote growth strategy aimed at becoming a top-class IT group in the ASEAN region5) Boost motivation and reinforce human resource management
The major initiatives taken in the first three quarters of fiscal 2019 are presented below.
1) Charge forward on switch to service-style business
During the first nine months of fiscal 2019, we strengthened our cloud and security business when welaunched the new Platform Square brand, which is based on the concept of providing one-stop
added-value services by combining our Cloud & Security solutions with our Consulting & Managed
Services. The new Platform Square brand brings together our specialists in cloud and security-related
solutions and various other fields. In addition to strengthened staff numbers, the new brand brings
together a wide range of solutions, from services consulting to managed services, which it is now using toaccelerate business expansion, including the creation of new services.
A key initiative in the settlement-related business domain is our cooperation with MUFG Bank todevelop a “token requester agency service” for the bank’s MUFG Wallet (temporary name), a new-4-

smartphone-based settlement service that the bank plans to introduce in spring 2019. The “token requester
agency service” will also be offered to other mobile digital wallet operators. This service uses TIS
technology to securely store tokenized settlement ID information on the full range of devices that might
be used to make payments, including smartphones, wearable devices, and IoT-capable equipment. We
will be working with MUFG Bank to develop services that leverage MUFG Bank’s expertise in payment
operations and TIS’s expertise in the construction and operation of payment IT infrastructure. Throughsuch services, we aim to provide the security infrastructure that will ensure peace of mind for those using
a diverse range of IoT devices to make online payments. In another cooperative venture aimed at making
payments in Japan easier for foreigners visiting the country, we are working with Sumitomo Mitsui Card
Company, Limited, to adapt our QRxDRIVE settlement service so that it can be used with the UnionPay
QR code settlement service provided by China’s UnionPay International, a leader in cross-border QR
code settlement services. As Japan’s first IT processing service operator, in addition to our QRxDRIVE
payment app TIS will be providing a QR payment gateway service that is based on an application
programming interface (API) that enables our service to be used with POS terminals, self-service
checkout terminals and other payment devices.
2) Robust prior investment to create new services
As part of our efforts to acquire state-of-the-art technology and enter the global market, we established acapital and business tie-up with R3 HoldCo LLC, a US-based technology startup that has established oneof the world’s leading brands in distributed ledger technology (DLT), a blockchain-related technology forcorporate users. In addition, to promote business development of robot integration (the linking of robotics
and ICT technologies) in the enterprise domain, we made an additional investment in SEQSENSE Inc., astartup company engaged in the development of autonomous mobile robots that we have previously been
involved with through seed investments from our corporate venture capital system and other connections.
In line with our efforts of promote open innovation through corporate venture capital, we have been
making investments through an AI-specialized corporate venture capital framework we established infiscal 2019 to speed up decision-making and facilitate closer collaboration with startup companies in the
AI field, where the remarkable pace of technological advance is attracting keen attention from companies
in all fields. In addition, we started the TIS Co-Creation Innovation Consortium to foster businesscollaborations between large corporations and startup companies and are accelerating our efforts toward
the early realization of an innovation ecosystem.
We also established a group laboratory at a WeWork community work space with the aim ofstrengthening our research and analysis functions as well as information sharing and collaboration bybringing together R&D departments from the entire TIS INTEC Group. We hope that providing a venue
for greater collaboration among Group R&D staff will facilitate the transition from the research stage tocommercialization and lead to the realization of a business creation ecosystem.
3) Added-value and productivity improvements in domains of expertise
During the first three quarters of the fiscal year, our preparations to launch CreditCube+ were advancedby the start of several projections with potential first users. CreditCube+ is a next-generation card
processing service that fully leverages the technologies and expertise cultivated through our CreditCube
credit-card core operations system. The new system will enable customers to improve competitiveness-5-and reduce costs by using a system that optimally balances the merits of shared data with customers’
proprietary data. In addition, we joined five other companies participating in a test run of the use ofelectronic payment service Alipay directly on ticket gates of the Yui Rail monorail line operated by
Okinawa Urban Monorail, Inc. The test was part of TIS’s effort to contribute to solutions that make travel
in Japan easier for foreign visitors and create new opportunities for business expansion through theconstruction and operation of settlement centers that handle customer payments for merchants andacquirers.
Group company INTEC Inc. continued its efforts to develop new high-value-added services. During
the period under review, INTEC succeeded in cloudifying its integrated CRM solution F3 (F Cube) whichleverages the company’s years of experience providing services for regional banks. INTEC has also
developed and begun offering new optional services, including an anti-money laundering system and an
automated loan screening service.
During the period, we continued our efforts to eliminate unprofitable projects and promoteenhancement reforms aimed at further improving profitability. The success of these efforts is evident in
the steady rise in the Group’s gross profit margin.
4) Promote growth strategy aimed at becoming a top-class IT group in the ASEAN region
As part of our effort to accelerate the development of our global business by strengthening relationships
and promoting collaborations with overseas companies through capital and business tie-ups, we
strengthened our partnership with our Indonesian equity-method affiliate PT Anabatic Technologies Tbk,
by purchasing convertible bonds with stock acquisition rights issued by the company. To help Anabatic
achieve further growth by accelerating the development of new businesses, such as settlement services
using QR codes and blockchains, we are working on the establishment of Group-led cooperative schemeswith R3 HoldCo LLC, which we entered into a capital and business alliance tie-up as noted above, andwith Shanghai-based CardInfoLink, which has extensive experience in such areas as the provision of QR
code settlement solutions. We strengthened our ties to another equity-method affiliate in the ASEAN
region when we acquired additional shares and increased our equity stake in MFEC Public Company
Limited, a leading provider of enterprise IT solutions in Thailand.
We have also entered into a capital and business tie-up with TinhVan Technologies JSC, a major IT
firm in Vietnam, with which we will work to develop the settlement business in Vietnam, starting with a
QR settlement service.
5) Boost motivation and reinforce human resource management
During fiscal 2019 we are continuing our efforts on the human resources front to promote the growth ofeach member of our diverse group of employees as well as the sustainable growth of the Company byimplementing various "workstyle reform" and "health management" measures. For example, in April
2018 we established a new Human Resources SBU, which has since issued a personnel manifesto. We
also publicly proclaimed our plans to make TIS a company where employees are highly motivated. The
manifesto presents the new Human Resources SBU’s three-point mission and various measures being
taken to fulfill the mission’s objectives in the areas of “evaluation, treatment, and remuneration”,“workstyle reform, health management, and diversity” and “hiring, training, and assignment”. We also
resolved to introduce, as part of these reforms, a new employment policy that extends the mandatory-6-

retirement age to 65, with no changes in the employee’s treatment after 60, meaning that basic salary andbonus remain based on job function and personnel evaluations. We are also pleased to announce that our
promotion of telework to create an employment environment that enables employees to choose when andwhere they perform the tasks required by their jobs has been recognized by the Ministry of Internal
Affairs and Communications, which included TIS among its “top hundred telework pioneers”—as acompany advancing the introduction and utilization of teleworking.
In addition to the above initiatives, we have launched cross-group projects centered on TIS and
INTEC to promote enhancement and greater efficiency of headquarters functions and are now considering
multifaceted approaches to realize these goals. As part of this effort, the Company absorbed groupcompany IT Service Force Inc., which was responsible for the shared services of the TIS INTEC Group,and consolidated its functions with existing Group headquarter functions. In line with the Group's policyof flexibly managing its capital position to enable flexible responses in its operating environment while
continuing to enhance shareholder returns and capital efficiency, we carried out a share buyback from
May to July 2018, resulting in the acquisition of 809,100 shares at a total acquisition cost of ¥4,209
million.
In January 2019, we announced a new Group basic philosophy, “Our Philosophy.” With “OurPhilosophy” providing the common values that will serve as the axis for all the activities of the entire TIS
INTEC Group, we will aim to be “A mover that helps to paint a brighter future” by carrying out our
corporate activities with confidence and conviction.
(2) Analysis of Financial Condition(Assets)
Consolidated total assets as of December 31, 2018, amounted to ¥344,397 million, a decrease of¥22,556 million from ¥366,954 million at the end of the previous fiscal year on March 31, 2018.
Current assets totaled ¥152,502 million, down from ¥162,064 million, primarily owing to a¥25,671 million decrease in notes and accounts receivable.
Fixed assets totaled ¥191,895 million, down from ¥204,889, owing mostly to a ¥12,290 million
decrease in the value of investment securities.
(Liabilities)
Total liabilities at the end of the third quarter of the fiscal year amounted to ¥120,542 million, a¥20,112 million decrease from ¥140,655 million at the end of the previous fiscal year.
Current liabilities totaled ¥70,897 million, down from ¥81,310 million nine months earlier, mainlyreflecting a ¥6,553 million decrease in accrued bonuses to directors and employees.
Non-current liabilities amounted to ¥49,645 million, down from ¥59,344 million, primarily owing
to a decrease of ¥6,031 million in long-term debt.

(Net assets)
Net assets at the end of the first three quarters of the fiscal year totaled ¥223,855 million, down ¥2,443
million from ¥226,298 million at the end of the previous fiscal year. The decrease primarily reflects an-7-¥11,605 million decline in net unrealized gains on other securities.
(3) Consolidated Earnings Forecast and Caution on Forward-Looking Statements
The Group turned in a solid consolidated business performance in the first nine months of the fiscal
2019. In the last three months of the fiscal year, the Group will strive to achieve its full-year targets bysteadily implementing various measures. Accordingly, there are no changes to the consolidated
earnings forecast announced on May 10, 2018.
From fiscal 2019, the Company has adopted a total return ratio* benchmark of 40%. Considering
the previously mentioned share buyback and the current consolidated earnings forecast, the Company
estimates the total return will come to 39.9% in fiscal 2019.
*Total return ratio: The ratio of the combined value of dividend payments and share buybacks versus
net income attributable to owners of the parent company-8-2. Consolidated Financial Statements(1) Consolidated Balance Sheets
As of March 31, 2018

Items
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable
Lease receivables and lease investment assets
Marketable securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Other current assets
Allowance for doubtful accounts
Total current assets
Fixed assets
Property and equipment
Buildings and structures, net
Machinery and equipment, net
Land
Leased assets, net
Other property and equipment, net
Total property and equipment
Intangible assets
Software
Software in progress
Goodwill
Other intangible assets
Total intangible assets
Investments and other assets
Investment securities
Net defined benefit asset
Deferred tax assets
Other assets
Allowance for doubtful accounts
Total investments and other assets
Total fixed assets
Total assets-9-

As of Dec. 31, 2018

millions of yen

millions of yen

38,032
94,438
4,747
100
3,526
5,432
263
15,884(360)
162,064

48,86968,767
4,238
100
4,648
8,692
228
17,240(283)
152,502

39,9907,547
19,373
2,952
5,815
75,68038,588
7,918
18,5502,817
5,974
73,84912,506
4,359
707
1,341
18,915

12,602
5,994
582
1,172
20,35178,766
5,610
8,958
17,230(271)
110,293
204,889
366,954

66,476
5,769
8,634
16,920(105)
97,695
191,895
344,397

As of March 31, 2018

Items
Liabilities
Current liabilities
Notes and accounts payable
Short-term borrowings
Income taxes payable
Accrued bonuses to directors and employees
Provision for loss on order received
Other allowances
Other current liabilities
Total current liabilities
Non-current liabilities
Long-term debt
Lease obligations
Deferred tax liabilities
Deferred tax liabilities from revaluation of land
Accrued retirement benefits to directors
Other allowances
Net defined benefit liability
Asset retirement obligations
Other non-current liabilities
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Common stock
Additional paid-in capital
Retained earnings
Less treasury stock, at cost
Total shareholders’ equity
Accumulated other comprehensive income
Net unrealized gains on other securities
Revaluation reserve for land
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets- 10 -

As of Dec. 31, 2018

millions of yen

millions of yen

23,2464,460
6,139
13,184
1,075
72
33,131
81,31017,912
6,973
2,109
6,631
694
65
36,51170,89725,482
3,997
3,925
403
65
650
17,296
3,471
4,051
59,344
140,655

19,451
3,567
1,694
272
56
306
12,531
3,878
7,886
49,645120,542

10,001
83,384
108,298(7,742)
193,941

10,001
83,384
121,649(11,923)
203,11131,922(2,375)128(1,983)
27,692
4,664
226,298
366,954

20,317(2,672)(278)(1,460)15,906
4,837
223,855
344,397

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income
First Three Qtrs.,
First Three Qtrs.,
FY2018FY2019Items(Apr. 1 – Dec. 31, 2017) (Apr. 1 – Dec. 31, 2018)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Other
Total non-operating income
Non-operating expense
Interest expenses
Financing expenses
Equity in losses of affiliated companies
Other
Total non-operating expenses
Recurring profit
Extraordinary income
Gain on sale of investment securities
Gain on sales of fixed assets
Other
Total extraordinary income
Extraordinary loss
Impairment loss
Data center transfer cost
Other
Total extraordinary loss
Income before income taxes
Income taxes: current
Income taxes: deferred
Total income taxes
Net income
Net income attributable to non-controlling interests
Net income attributable to owners of the parent company- 11 -

millions of yen

millions of yen

289,021230,770
58,251
37,554
20,696302,961
236,676
66,284
41,261
25,022

24
1,019
574
1,619

132
983
475
1,591

253
4
661
439
1,360
20,955

254
302
148
393
1,098
25,516

42
440
7
490

13,145913
301
14,360512452
964
20,481
3,300
3,267
6,567
13,913452
13,460

457
8,800
3,989
13,247
26,628
6,465
2,641
9,106
17,522542
16,979

Consolidated Statements of Comprehensive Income
First Three Qtrs.,
First Three Qtrs.,
FY2018FY2019(Apr. 1 – Dec. 31, 2017) (Apr. 1 – Dec. 31, 2018)

Items
Net income
Other comprehensive income
Net unrealized gains on other securities
Revaluation reserve for land
Foreign currency translation adjustments
Remeasurements of defined benefit plans
Share of other comprehensive income of equitymethod affiliates
Total other comprehensive income
Comprehensive income(Composition)
Comprehensive income attributable to owners of theparent company
Comprehensive income attributable to noncontrolling interests- 12 -

millions of yen

millions of yen

13,913

17,522

10,916
93
157(11,589)
(296)
(327)
524

3

(127)

11,17025,083(11,815)
5,707

24,529

5,193

554

513

(3) Notes on the Consolidated Financial Statements(Notes on the Going-concern Assumption)
Not applicable(Notes on Significant Changes in the Amount of Shareholders’ Equity)
Not applicable(Additional Information)
As the Company has adopted Partial Amendments to Accounting Standard for Tax EffectAccounting (ASBJ Statement No.28, February 16, 2018) and other related standards from the
beginning of the first quarter of the fiscal year ending March 31, 2019, “deferred tax assets” ispresented in the category of investments and other assets, and “deferred tax liabilities” is presented
in the category of non-current liabilities.
3. Other Information
INTEC Inc., a consolidated subsidiary of the Company, is currently in litigation with Mitsubishi
Shokuhin Co., Ltd., which filed a claim for compensation in connection with services including
systems development provided by INTEC Inc. (Amount of compensation demanded: 12,703 million
yen; date the complaint was received: December 17, 2018).

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