Consolid
dated Financcial Results foor the First T
Three Quarteers of the Fisscal Year Endding March 31,
3 2015(Appril 1, 2014 tthrough Deceember 31, 20
014)(Prepared purrsuant to Jap
panese GAAPP)
All financcial informatioon has been preparedpin acccord with accoounting princiiples generallyy accepted in Japan.
This is a ppartial Englishh translation ofo the originall Japanese-lan
nguage docum
ment. All inform
mation pertain
ns to
consolidaated results unnless otherwisee noted. Informrmation on thee basis of presentation of coonsolidated fin
nancialstatementts does not apppear in this traanslation.
February 2, 2015
Compaany name:
Stock eexchange listinngs:
Stock ccode:
URL:
Represeentative:
Contactt:Phone:

IT Hooldings Corporration
The First
F
Section off the Tokyo Stock Exchangge3626
http:///www.itholdinngs.co.jp/e/Norio Maenishi, Prresident
Akio Kita,
K Executivve Officer, Deeputy Divisionn Manager, Addministration Division+81 3-5338-2272

Scheduuled dates
Submisssion of quarteerly report:
Commeencement of dividenddpaym
ments:

Februarry 10, 2015-

mentary materials to the quuarterly resultss:
Supplem
Quarterrly results presentation heldd:Available
Yes (targeted at institu
utional investtors and analysts)

Figgures in millio
ons of yen aree rounded dow
wn to the neareest million
1. Consoolidated Resu
ults for the FirstF
Three Q
Quarters of the Fiscal Yea
ar Ending M
March 31, 201
15(Apriil 1, 2014 – DecemberD
31,, 2014)(1) Consoolidated Finanncial Results

Percentaages indicate yyear-over-yeaar changes
Operating income Reecurring profitt
Net inncome

Net
N salesmillions of yen%

254,8872
238,447
2

6.99
1.00

First Thhree Qtrs., FY
Y2015First Thhree Qtrs., FY
Y2014

millions of yeen%

10,803 28.8
8,388 8.4

milllions of yen%

10,829 31..3
8,251 18..0

millions of yen%

4,866 51.5
3,2
211 20.2

Note: Compprehensive incom
me: First Three Qtrrs., FY 2015: 21,8802 million yen (170.3%), First Thrree Qtrs., FY 20144: 8,066 million yeny (147.0%)

Net
N income
per share – basic
First Thhree Qtrs., FY
Y2015First Thhree Qtrs., FY
Y2014

Net income
per shaare –diluteedyen

yen

55.59936.599

55.55
36.55

(2) Consoolidated Finanncial Position
Total assets
End of T
Third Quarterr, FY2015
End of F
FY2014

Net assets

Equuity ratio

millions of yeen

millions of yen%

323,8866
313,6100

177
7,728
164
4,502

53.5
49.9

For referennce: Total equitty: End of third quarter, FY20115: 173,352 million yen End of FY2014: 1556,452 million yen.
y*Total equuity = Shareholdders’ equity plu
us total accumullated other com
mprehensive income

2. Cash D
Dividends forr Shareholderrs of Commoon Stock
Record dateor period
FY20144
FY20155
FY20155(forecasst)

Q1
End-Q

Cash dividends
dper share
End-Q2 End-Q3 Y
Year-end

Total
T

y
yen

yen

yen

yen

-

8.00
10.00

-

17.00

25.00
2

20.00

30.00
3

Note: Revvisions from thee latest release ofo dividends forrecasts: Noneyen

3. Forecast of Consolidated Results for FY2015 (April 1, 2014 – March 31, 2015)
Percentages indicate year-over-year changes
Operating
Net income per
Net sales
Recurring profit
Net income
incomeshare – basic
Full FY 2015
(year ending Mar.
31, 2015)

millions of yen%

355,000

2.4

millions of yen%

21,500 10.2

millions of yen%

millions of yen

20,500

8.1

10,000

%

Yen

26.4

114.26

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.: Yes
2) Changes other than noted in 1) above: Yes
3) Changes in accounting estimates: None
4) Retrospective restatement: None
Note: For further details, please refer to “(1) Changes in Accounting Policy, Changes in Accounting
Estimates, and Retrospective Restatement” in the “2. Other Information” on page 5 in the
Accompanying Materials.
(4) Common stock issued
1) Issued shares as of period-end (including treasury stock):
End-Third Quarter, FY2015 (December 31, 2014): 87,789,098 shares
End-FY2014 (March 31, 2014):
87,789,098 shares
2) Treasury stock as of period-end:
End-Third Quarter, FY2015 (December 31, 2014): 319,028 shares
End-FY2014 (March 31, 2014):
4,337 shares
3) Average number of shares (during the respective nine-month period):First three quarters, FY2015 (ended December 31, 2014): 87,539,797 sharesFirst three quarters, FY2014 (ended December 31, 2013): 87,771,067 shares*Quarterly review status
These materials are not subject to the quarterly review procedure requirements of Japan’s Financial Instruments
and Exchange Act. As of this report’s publication, a review of the quarterly consolidated financial statements inaccordance with the Act had not been completed.
Caution on Forward-Looking Statements and Other Important Matters
This report contains forward-looking statements that reflect IT Holdings Corporation (ITHD)’s plans andexpectations based on information available to ITHD at the time of preparation and on certain other information
ITHD believes to be reasonable. These forward-looking statements are not guarantees of future performance, andactual 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“(2) Consolidated Earnings Forecast and Caution on Forward-Looking Statements” in the “1. Results ofOperations” section on page 4 in the Accompanying Materials.

Accompanying Materials – Contents

1. Results of Operations

2(1) Analysis of Consolidated Operating Results2(2) Consolidated Earnings Forecast and Caution on Forward-Looking Statements

4

2. Other Information

5(1) Changes in Accounting Policy, Changes in Accounting Estimates, and Retrospective

5

Restatement
3. Consolidated Financial Statements

7(1) Consolidated Balance Sheets

7(2) Consolidated Statements of Income and Comprehensive Income

9

Consolidated Statements of Income
For the First Three Quarters

9

Consolidated Statements of Comprehensive Income
For the First Three Quarters

10(3) Notes on the Consolidated Financial Statements

11(Notes on the Going-concern Assumption)

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

111

1. Results of Operations(1) Analysis of Consolidated Operating Results
In the first nine months of fiscal 2015 (April 1, 2014 – December 31, 2014), the Japanese economy on the wholecontinued its steady recovery despite a reactionary decline in demand caused by a spending surge prior to theconsumption tax increase and concerns over economic trends overseas.
In the IT services industry, to which the IT Holdings Group belongs, the business environment in Japanremained strong. The Bank of Japan’s quarterly Short-term Economic Survey of Enterprises in Japan indicatedthat corporate software investment plans (all industries including financial institutions) continued to improve(December 2014 survey showed a 2.9% year-on-year increase in spending).
Under these circumstances, the Group promoted various initiatives under its Group management strategy inaccordance with the three basic concepts of the ongoing second medium-term management plan: “Top-Line
Emphasis,” acting “as One Company” and being “Enterprising and Bold”.
Consolidated net sales for the Group in the first nine months of the fiscal year increased 6.9% versus the same
period of the previous fiscal year to ¥254,887 million. Operating income rose 28.8% to ¥10,803 million from ayear earlier, recurring profit increased 31.3% to ¥10,829 million, and net income rose 51.5% to ¥4,866 million.
Consolidated net sales exceeded the level for the same period of the previous fiscal year, as the Groupaccurately grasped the IT investment needs of its customers. Profits rose strongly, as the increase in sales and thecontrol of unprofitable projects absorbed expenses for strengthening the structure to acquire and execute multiple
large-scale development projects.
Segment results for the first nine months of the fiscal year are as follows. The sales figures for each segment
include inter-segment sales.

1) IT Infrastructure Services
Consolidated sales rose 2.4% year on year to ¥86,673 million and operating income declined 2.8% to ¥4,977
million. While net sales increased compared with a year earlier on the back of strong growth of the data center
business, operating income declined slightly from the same period a year earlier due to the impact of reduction inscale of business with some existing clients.

2) Financial IT Services
Consolidated sales in the first nine months of the fiscal year increased 8.8% from the same period a year ago to¥57,026 million, while operating income rose 6.1% to ¥3,597 million from the same period of the previous fiscal
year. Sales grew year on year, as major customer credit card companies and other enterprises expanded their
IT-related investments. Operating income also increased, as the sales growth absorbed expenses for structural
reinforcement aimed at acquiring and executing large-scale development projects.

3) Industrial IT Services
Consolidated sales increased 9.6% year on year to ¥113,070 million, and operating income totaled ¥1,563
million (compared with an operating loss of ¥687 million in the same period a year ago). The sales increasereflected strong overall demand, led by service, retail, and manufacturing industries. Operating income
rebounded strongly, as the increase in sales and efforts to control unprofitable projects absorbed an increase in
the number of sales projects with low profitability and the expenses for consultative activities for large-scale and2other development projects.

4) OtherConsolidated sales in this segment declined 10.9% year on year to ¥11,001 million, and operating income
declined 1.4% to ¥1,560 million. This was mainly due to the impact of the sale of lease assets of TIS Leasing Co.,
Ltd. and withdrawal from the leasing business as of the end of the previous fiscal year as part of efforts topromote the development of a structure that would allow it to focus on the core businesses and growth fields.

With the aim of becoming an IT business that will implement reforms as a single unit, the Group is
implementing its second medium-term management plan (from fiscal 2013 through fiscal 2015) and positions
the current fiscal year, which is the final year of the plan, as the year to complete the measures. The Group set
forth the following group management strategy for fiscal 2015 based on the basic concepts of the medium-term
management plan and in consideration of the achievements through fiscal 2014 and the implementation status ofvarious measures. The Group continues to promote various measures to achieve the strategy.

The second medium-termGroup management strategy for fiscal 2015

management plan basic concepts
Top-Line Emphasis

Put emphasis on the amount of profit and profit ratio and maintain a Group
top-line that ensures them.

as One Company

Focus on operating the Group with a sense of unity based on strengtheningof its communication base.

Enterprising and Bold

Bolster the Group’s efforts to expand the services-oriented business andpromote globalization.

IT Holdings Group’s key moves in the first nine months of fiscal 2015 are as follows:

1. “Top-Line Emphasis”
In October 2014, the Group merged TIS First Manage Inc. into TIS Solution Link Inc. as part of transplant andconsolidation of business domains to pursue growth through business collaboration between group companies.
The move enables consolidation of customer onsite service business. At the same time, the Group transferred
TIS First Manage’s embedded-type business to Qualica Inc. to strengthen the Group’s capability to respond to
customer requests.
Moreover, in response to the growing demand for data centers in the Kansai region, TIS, Inc. agreed with
Nomura Research Institute, Ltd. to cooperate on the joint operation of a new data center. The two companies
signed a basic agreement in April 2014 and are making preparations to open the data center in the summer of
2016.

2. “as One Company”
The Group decided to unify the group brands to develop a sense of togetherness and strengthen the brand tosucceed in operating the Group with a sense of unity, and all Group companies in June 2014 started using thecommon Group logo. Furthermore, the Group decided to consolidate the offices of Group companies in Osaka
district in summer of 2015 in order to ensure smooth communications among the Group companies and promote

3cooperation among them.
Furthermore, in October 2014, IT Holdings decided to make consolidated subsidiary AGREX Inc. a wholly
owned subsidiary in order to raise corporate value by strengthening competitiveness through reorganization ofGroup functions and enhancing consolidated management efficiency through Group’s total optimization. IT
Holdings judged that it was necessary to rebuild capital relationship of the IT Holdings Group so as to enable
dynamic and flexible businesses and reorganization of functions. Therefore, IT Holdings made a tender offer for
shares of AGREX between October and December 2014 and is taking procedures to make AGREX its wholly
owned subsidiary at an early date.
After the conversion to a wholly owned subsidiary, AGREX will be positioned as the core entity of theGroup’s BPO business, strengthening collaboration with Group companies through such measures as thecentralization of the BPO business currently scattered throughout the Group.

3. “Enterprising and Bold”
In its efforts towards globalization, the Group has been promoting further business expansion targeting Japanese
as well as local companies in the respective countries through lateral expansion based on alliance strategies. As
part of these efforts, TIS agreed on a capital and business alliance in April 2014 with MFEC Public Co., Ltd., apublicly traded IT company in Thailand and a leading player in IT solution for the enterprise, while in June 2014
TIS made I AM Consulting Co., Ltd., a SAP total solution provider in Thailand, a consolidated subsidiary.
As part of shift to services-oriented business, INTEC Inc. was selected to provide municipal cloud services tobe shared by cities, towns and villages of Toyama Prefecture and is currently engaged in the development of thesystem environment. INTEC, which has been providing municipal cloud services such as an electronic bidding
systems and tax document search systems, will jointly offer a backbone system that will be central to the local
government’s operations and services, utilizing CIVION-7th, a general administrative information system. It willbe the first time such a shared use of a backbone system is implemented in Toyama Prefecture.
At the same time, Qualica Inc., with the aim of expanding its core aftermarket business, took over a part ofKomatsu Ltd.’s CSS-Net business in April 2014. The move enables Qualica to combine CSS-Net’s document
computerization and Web broadcasting system with its own CareQube, a remote monitoring and preventive
maintenance system developed by Qualica. It will use the acquisition to raise customer satisfaction even further
and expand its business.

Further, the Group will continue to discuss and promote various measures from the perspectives of “achievingGroup total optimum” and “development of unique and clear strengths (growth engines) and collaboration.”(2) Consolidated Earnings Forecast and Caution on Forward-Looking Statements
The Group’s consolidated business results have generally been in line with forecasts, and therefore there is nochange to the consolidated earnings forecast announced on May 9, 2014.

4

2. Other Information(1) Changes in Accounting Policy, Changes in Accounting Estimates, and Retrospective
Restatement
Changes in Accounting Policy(Application of Accounting Standard for Retirement Benefits, etc.)“Accounting Standard for Retirement Benefits” (Accounting Standards Board of Japan - ASBJ - Statement No.
26 of May 17, 2012) and “Guidance on Accounting Standard for Retirement Benefits” (ASBJ Guidance No. 25
of May 17, 2012) have been applied, effective from the first quarter of the current consolidated financial year
ending March 31, 2015 (April 1, 2014 to June 30, 2014), in accordance with the provisions of Article 35 of the
Accounting Standard for Retirement Benefits and Article 67 of the Guidance on Accounting Standard for
Retirement Benefits.
As a result, the methods for calculating retirement benefit obligations and service costs have been revised, andthe method for attributing projected benefits to periods has been changed from the straight-line basis to thebenefit formula basis. As to the discount rate, it used to be calculated based on the bond duration, comparable toemployees’ average remaining years of service. Under the new accounting standard, however, the method ofdetermining the discount rate has now been changed to use a single weighted-average discount rate that reflects
the periods until the expected payment of retirement benefits and the amount of projected benefits for every such
period.
In accordance with the transitional treatment provided in Article 37 of the Accounting Standard for Retirement
Benefits, the effect of the change in calculation method for retirement benefit obligations and service costs wasrecognized by adjusting retained earnings at the beginning of the first quarter of the financial year ending March
31, 2015.
Consequently, as at the beginning of the first quarter of the current financial year ending March 31, 2015, net
defined benefit liability decreased by ¥1,657 million, while net defined benefit asset increased by ¥660 million,
resulting in ¥1,532 million increase in retained earnings. Yet, the effect of this change on the consolidated
income statement for the first nine months of the financial year ending March 31, 2015, is immaterial.

(Application of Accounting Standard for Business Combination)“Accounting Standard for Business Combinations” (ASBJ Statement No. 21 of September 13, 2013),“Accounting Standard for Consolidated Financial Statements” (ASBJ Statement No.22 of September 13, 2013),“Accounting Standard for Business Divestiture” (ASBJ Statement No. 7 of September 13, 2015) and related
standards are made applicable to the consolidated financial year starting April 1, 2014 and onwards.
These accounting standards (except the provisions of Article 39 of Accounting Standard for Consolidated
Financial Statements) have now been applied, effective from the first quarter of the current consolidated
financial year (April 1, 2014 to June 30, 2014). Under this new application of these standards, differences causedby change in the Company’s equity in the subsidiaries and affiliates with controlling interests shall be now
adjusted in additional paid-in capital, and acquisition-related expenses shall be all reported as expenses accruing
during the consolidated financial year in which said acquisition takes place.
As to a business combination to take place after April 1, 2014, i.e. the beginning of the first quarter of thecurrent consolidated financial year, appraisal of purchase price allocation, pursuant to the final determination ofprovisional accounting treatments, shall now be changed to be reflected in the quarterly consolidated financial

5statements where the date of the business combination falls.
The implementation of Accounting Standards for Business Combinations and its related standards is subject tothe transitional treatments stipulated in the provisions of Article 58-2 (4) of Accounting Standard for Business
Combinations, Article 44-5 (4) of Accounting Standard for Consolidated Financial Statements, and Article 57-4
(4) of Accounting Standard for Business Divestiture, and has been and will be under way since the beginning of
the first quarter of the current consolidated financial year and going forward.
As a result, in the first nine months of the financial year ending March 31, 2015, operating income decreased¥94 million, and recurring profit and income before income taxes and minority interests each declined ¥222
million. Additional paid-in capital decreased ¥3,135 million at the end of the third quarter of the fiscal year.

63. Consolidated Financial Statements(1) Consolidated Balance Sheets
As of Mar. 31, 2014

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
Deferred tax assets
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
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

7

As of Dec. 31, 2014

millions of yen

millions of yen

43,24868,301
6,654
226
3,207
6,757
229
6,603
8,450
(159)
143,519

27,72256,173
5,997
3,011
5,355
10,651
226
4,498
9,799
(73)
123,364

56,565
4,428
20,726
4,738
5,153
91,612

54,245
4,571
24,612
4,422
4,513
92,365771
14,802
15,573

1,185
15,82017,00638,787
4,103
6,881
13,362(229)
62,905170,091
313,610

66,990
4,933
6,069
13,532(377)
91,149200,521323,886

As of Mar. 31, 2014

Items
Liabilities
Current liabilities
Notes and accounts payable
Short-term borrowings
Income taxes payable
Accrued bonuses to directors and employees
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
Net defined benefit liability
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
Stock acquisition rights
Minority interests
Total net assets
Total liabilities and net assets

8

As of Dec. 31, 2014

millions of yen

millions of yen

18,82814,2993,495
10,932
1,007
24,226
72,79015,76818,303
387
5,527
591
28,584
69,16344,570
6,160
470
732
88
18,6885,606
76,316
149,10737,700
5,634
9,533
732
89
17,666
5,637
76,994
146,157

10,00186,786
57,579(6)
154,360

10,001
83,652
61,610(511)
154,752

5,975(1,967)48(1,964)
2,092
45
8,004
164,502313,610

22,266(1,967)144(1,843)
18,59958
4,317
177,728
323,886

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statements of Income
First Three Qtrs.,
First Three Qtrs.,
FY2014FY2015
Items(Apr. 1 – Dec. 31, 2013) (Apr. 1 – Dec. 31, 2014)
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
Equity in losses of affiliated companies
Other
Total non-operating expenses
Recurring profit
Extraordinary income
Gain on sale of investment securities
Gain on transfer of business
Other
Total extraordinary income
Extraordinary loss
Impairment loss
Loss on business liquidation
Special severance pay
OtherTotal extraordinary loss
Income before income taxes and minority interests
Income taxes: current
Income taxes: deferred
Total income taxes
Income before minority interests
Minority interests in earnings of consolidated subsidiaries
Net income

9

millions of yen

millions of yen

238,447
197,901
40,54532,157
8,388

254,887
210,593
44,29433,49010,803

35
630
823
1,489

44
704
694
1,443

469
332
825
1,626
8,251

385
265
765
1,416
10,829

233
69
4
308

376
－
3
379

100
367
278
325
1,071
7,487
1,576
2,151
3,727
3,760
548
3,211

594
－
－
1,351
1,945
9,263
1,609
2,390
3,999
5,264
398
4,866

Consolidated Statements of Comprehensive Income
First Three Qtrs.,
First Three Qtrs.,
FY2014FY2015(Apr. 1 – Dec. 31, 2013) (Apr. 1 – Dec. 31, 2014)

Items

millions of yen

Income before minority interests
Other comprehensive income
Net unrealized gains on other securities
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 theparentComprehensive income attributable to minority
interests

10

millions of yen

3,760

5,264

4,151
139
－

16,308
105
122

15

2

4,306
8,066

16,53821,802

7,457

21,373609

429

(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 applicable11