FINANCIALREPORT
April 2016 - March 2017

Management Policy
1. Basic Management Policy
Amano’s management philosophy is to create new values and contribute to the realization ofa safe, comfortable and a wholesome society in the fields of “People & Time” and “People &Environment.”
Under this management philosophy and based on an optimal governance structure that responds to changes in the business environment, we will strive to maximize corporate value by
ensuring sustained growth through the creation of new businesses and markets with a mediumto-long term global perspective, in addition to expanding our existing businesses. Furthermore,
we will aim to become a company that has the trust and high regard of all the stakeholders
including customers, business partner companies, shareholders, employees and the local community by constantly returning a fair profit earned through business activities.

2. Medium- to Long-term Corporate Management Strategies and Issues to Address
We launched a new three-year “medium-term business plan,” which will apply from April
2017 until March 2020. An outline of the plan is set out below.
[1] Basic Policies
Under the new medium-term business plan, with the Group’s management concept of “The2nd Stage Towards a 100-year Company-Innovative Creation of Value for Sustainable Growth,”
we will address four key issues towards achieving the goal of “enhancing our corporate value”
while emphasizing compliance and further strengthening corporate governance as a foundation.
(1)	Regional Growth Strategies: Promote growth strategy for each of the four regions (Japan,
North America, Europe and Asia).
(2)	Reinforcement Management Foundation: Reinforce management practices based on productivity improvement by continuing cost reduction activities and a work style reform.
(3)	Create Innovation: Aim to be the clear niche leader and build the sixth and seventh corebusinesses.
(4)	Improve Brand Value: Promote the enhancement of the value of Amano brands throughefforts to address the key issues described above.
The target of the new medium-term business plan is the achievement of the “triple 11.”(1)	Operating profit ratio: 11% or more(2)	ROE: 11% or more(3)	The ratio of consolidated net sales to non-consolidated net sales: 11% growth
Measures and issues for each region under these basic policies are as follows:
1. Japanese market
In the Japanese market, we will reinforce ties among domestic Group companies and also withother companies outside the Group and strengthen our capacity to provide holistic solutions(which cover hardware, software, and services) across all business fields both qualitatively andquantitatively. We will also promote the strategic “3-in-1 activity” to increase our customer
base by cultivating and further attracting existing customers and aim to be the clear niche
leader on a medium- to long-term basis in each business field.
The Information Systems business is witnessing tangible demand for time & attendance management systems, which enables proper employee work management. Amid the implementation of the Japanese government guidance to eradicate long working hours (overworking) andto improve productivity, corporate measures to establish a framework to manage appropriate
work hours have become the subject of attention. In addition, against the backdrop of the revision to the Labor Standards Act, which aims to facilitate diverse ways of working, it is expectedthat demand for system upgrades along with systems utilizing cloud services and smart devices
will increase.
1

In response to this market environment, we will enhance our customer base by providing a
one-stop service covering hardware, software and cloud services. For the small-to-medium
sized enterprise market, we will further strengthen the marketing of TimePro-NX, a software
package launched last year that provides holistic solutions for time & attendance, humanresource management and payroll. For the medium-to-large enterprise market, we will collaborate with CREO CO., LTD., to provide software for time & attendance, human resource
management, payroll and accounting, and in addition, we will strengthen consulting activities
to become an “HR solutions vendor” in order to expand our business domains.
The Parking Systems business is witnessing continuing growth in the nation’s parking lot market owing to the real estate market becoming buoyant in advance of the 2020 Tokyo Olympics.
In addition to the need for parking lot management cost reduction, ensuring safety and security
in parking lots, consideration for the environment and the improvement of user convenience,
the need to propose solutions for new operational methods such as web-based or cashless useof parking lots has been increasing.
Given this market environment, we will further strengthen partnerships with major parking lot
management companies and provide various services through our parking lot data center forsmall- and medium-sized parking lot management companies while improving the functions
and operability of system equipment. In order to respond to transitions in the market including
the increased demand for parking reservations and the migration towards a sharing economy,
we will aim to become a “total parking solutions vendor.” In addition, we will continue tostrengthen and expand our efforts for facilities such as bicycle parking lots, security gates andtoll roads in order to expand our business.
In Environmental Systems, capital investment by companies in Japan, especially automobilerelated firms, remained solid, and capital investment by Japanese companies operating overseas including in the U.S. has also been strong despite the influence of a slowdown of the Chinese economy.
Given this market environment, in Japan we will aim to increase the quantity of sales of standard equipment by rolling out new products and expand business domains including the pharmaceutical, food, and cosmetics markets, which are less affected by business sentiments. We
will also work to strengthen our engineering capabilities and comprehensive sales, includingthat of peripheral equipment, by partnering with industrial equipment manufacturers and aim
to become an “M2M partial solutions vendor.”In the Clean Systems, while the trend of companies trying to reduce cleaning costs continues,
amid the aging of sanitation workers and an increase in the number of inexperienced workers,
the need to improve safety and operability of cleaning equipment has been increasing. At thesame time, the need to maintain building aesthetics at a low cost has also been increasing.
In response to these market conditions, we will expand the robotic cleaning devices market(robotic scrubbers, robotic vacuum cleaners), the factory market with new model scrubbers
as well as a business producing an income stream by increasing maintenance contracts andorder intakes for supply goods, thus bolstering our customer base in Japan. With the aim of becoming a “robotic solutions vendor,” which focuses on cleaning robotic devices, we will also
promote comprehensive proposals, including those for commissioned cleaning services andaesthetic maintenance.
2. North American market
In the Parking Systems business, we will step up sales of Amano McGann, Inc.’s system equipment
which was launched two years ago and have a new system that target the low-end market gain afoothold at an early stage. In the Information Systems business, we will strive to expand operations
by increasing sales of Accu-Time Systems, Inc.’s time and attendance information terminals and by
developing cloud services. In the Clean Systems business, we will further expand the business of
the wooden floor sanding equipment division of Amano Pioneer Eclipse Corp. and develop new
niche areas and channels. In the Environmental Systems business, at Mexican subsidiary established last year, we will boost sales of standard equipment to Japanese companies operating in theregion, especially automobile-related businesses.

23.European market
In the Information Systems business, we will further enhance our customer base by promoting
Horoquartz’s workforce management and access control businesses. In the Parking Systems
business, we will strive to expand operations by developing a commissioned parking lot management business.
4. Asian market
In the Asian region, we will aim to expand Parking Systems operations by strengthening services in the commissioned parking lot management business and by expanding services into
new regions. In the Environmental Systems business, we will strengthen our engineering capabilities as well as sales and service systems for Japanese companies operating in Asia by making use of the ties between our Group companies across Asia and our head office in Japan. We
will also expand our local production capabilities in order to enhance cost competitiveness.
Other issues that need to be addressed are listed below:
1. Practical implementation of a work style reform
With the aim of improving productivity of the whole Group, we will continue the efforts toincrease productivity by having each employee regulate their biological clock and create atimetable which reflects the prioritization of their job duties. We will publish examples andthe results of our company’s efforts as an “HR solutions vendor” to the public and incorporatesuch examples to enhance the product appeal of time & attendance systems.
2. Create innovation
We will aim to become the “clear niche leader” by increasing each business division’s No.1
areas. We will also promote open innovation by acquiring technology and know-how fromcompanies outside our Group through cooperation with venture companies and M&As regardless of our existing technology and know-how in order to build the “sixth and seventh corebusinesses” as new businesses. In addition, with future market trends in mind, we will promoteresearch and development that is not necessarily limited to our current product or service
lineup (to defeat innovation dilemmas) in order to aim for leading-edge business development
utilizing AI, IoT, robotic devices and the web.
3. Further improvement of brand value
In order to improve our corporate value, we will strive to gain wider recognition of our company in the overall market by taking advantage of mass media and social media, and aim tofurther enhance our brands by strongly promoting each business division’s brand strategies andby creating synergy effects with our Group companies more than ever before.
[2] Numerical targets
We are aiming to achieve ¥140.0 billion or higher in net sales and ¥16.0 billion or higher inoperating profit for the fiscal year ending March 31, 2020, which is the final year of the plan.

Numerical targets

Net sales
Operating profit
Operating profit ratio (%)
Ordinary profit
Net income attributable to ownersof the parent company(Millions of yen)

FY 2017(ended March 2018)
AmountYoY (%)
126,000
4.9%
13,8004.8%
11.0%–
14,300
3.6%
9,400

1.9%

3

FY 2018(ending March 2019)
AmountYoY (%)
132,000
4.8%
14,5005.1%
11.0%–
14,900
4.2%
9,800

4.3%

FY 2019(ending March 2020)
AmountYoY (%)
142,000
7.6%
16,000
10.3%
11.3%
–
16,40010.1%
10,80010.2%

3. Basic Policy on Distribution of Profits and Payment of Dividends for This Fiscal Yearand the Next
Amano places great importance on its policy for the payment of dividends to shareholders.
Fundamental to this is its policy for the return of profit to shareholders, based on maintaining
a stable ordinary dividend, together with appropriate results-based distributions of profits andflexible purchasing of treasury stock. The Company aims to maintain a payout ratio of at least
40% on a consolidated basis and a ratio of dividend to net assets of at least 2.5%.
In line with this policy, taking into account our current-year operations results, we plan to pay
a year-end dividend of ¥29 per share. As a result, the annual per-share dividend for this fiscal year will be ¥52 (including ¥23 per share paid as the interim dividend), an increase of ¥4compared with the previous fiscal year. This corresponds to a dividend payout ratio of 43.0%
and a 4.1% ratio of dividends to net assets on a consolidated basis.
With regard to the dividend for the next fiscal year, in line with our Basic Policy on Distribution of Profits and in view of our Outlook for Fiscal Year Ending March 31, 2018, we aim to
pay an annual per-share dividend of ¥52 (with an interim dividend of ¥23 and a year-end dividend of ¥29).
Retained earnings will be earmarked to fund effective investment aimed at the fundamental
enhancement of the Company’s capacity to conduct its business operations. This will include
the expansion and strengthening of existing business fields, strategic investment in growthfields, and spending on research and development, as well as the rationalization of production
plants and equipment for the purpose of reducing costs and further improving product quality.

Hiroyuki TSUDA
President
Representative Director

4General Business Results
Business Results in the Year Ended March 31, 2017

General Business Results for This
Fiscal Year
During the fiscal year under review,
while the US economy remained
steady amid the lingering uncertainties arising from the slowdown ofemerging economies such as China,
UK’s withdrawal from the EU, andconcerns over policy administrationof the new US government regime,
the Japanese economy remained ona gradual recovery trend. In Japan,
employment and capital expenditures remained firm and in the second half of the fiscal year, exports
showed signs of recovery spurredby the weakening of the yen and rising stock prices.

general, and administrative (SG&A)
expenses.

Amid this business environment, theAmano Group worked on global
marketing and product deployment
as well as the enhancement of its
capacity to provide holistic solutions,based on its 6th medium-term business plan launched in April 2014.
Under this plan, the Group set forth
the management concept of “Challenge to a New Stage,” a concept
aimed at making the organization
a “100-year company.” The Amano
Group also concentrated on thoroughly uncovering customer needs
and strove to reduce the costs ofgoods sold (COGS) and selling,

As a result of the above, during the
fiscal year under review, the Company recorded sales of ¥120,124
million, up by 0.5% year-on-year.
Operating profit increased by 1.7%
to ¥13,165 million, ordinary profit
went up by 1.0% to ¥13,806 million,
and net income, which is attributableto parent company shareholders,increased by 9.7% to ¥9,223 million,
resulting in increases in both sales
and profit.
The following is a breakdown ofsales by business division.

Sales by business division(Unit: Millions of yen)

FY2015
Category

FY2016

Change(April 1, 2015–March 31, 2016) (April 1, 2016–March 31, 2017)
AmountRatio (%)

AmountRatio (%)

Amount%Information Systems

25,512

21.3

24,789

20.6

(723)

(2.8)

Time Management Products

4,165

3.5

3,818

3.2

(346)

(8.3)

Parking Systems

55,784

46.7

58,402

48.6

2,618

4.7

85,462

71.5

87,010

72.4

1,548

1.8

Environmental Systems

21,83018.3

21,712

18.1

(117)

(0.5)

Clean Systems

12,213

10.2

11,401

9.5

(812)

(6.7)

Subtotal

34,04428.5

33,113

27.6

(930)

(2.7)

Total

119,506

100.0

120,124

100.0

617

0.5

Time Information System business:

Subtotal
Environment System business:

5Time Information System business• Information Systems:
Time & attendance (T&A), payroll,human-resource management, access
control, and cafeteria systems• Time Management Products:
Time recorders and time stamps• Parking Systems:
Parking and bicycle-parking space
management systems, and commissioned parking lot management service
Sales in this business division totaled¥87,010 million, representing an increase of ¥1,548 million (1.8%) yearon-year. The following is a breakdown of sales by business division.

Information Systems
In this business division, against the
backdrop of the “work style reform”
promoted by the Japanese government, attention is turning to the
future trends of companies’ efforts
to address long working hours, improve productivity and make full useof diverse human resources.
In response to these market conditions, the Company, being “Amano—
active in the area of HR (Human
Resources),” added access control
and security to the list of its “3-in-1”
proposal comprising time & attendance (T&A), payroll, and humanresource management, thus striving
to bolster its activities to provide
total solutions from system ownership to system use.
Domestic sales for this fiscal year
were as follows. For Amano, on an
unconsolidated basis, hardware sales
decreased by ¥182 million (4.1%),
software sales declined by ¥464 million (7.6%), and sales generated bymaintenance contracts and supplies
services increased by ¥183 million(4.8%) year-on-year. The decreasein hardware sales was a result of aslowdown in demand for renewing older model terminals in thefirst half of this fiscal year while thelower software sales were attributable to the delay in marketing activities for “TimePro-NX,” which is a
new piece of software for small andmedium businesses launched lastApril. Sales at Amano Business Solutions Corporation, which provides
cloud services, achieved double-digit
growth owing to a steady increasein demand.
Overall overseas sales decreasedby ¥395 million (4.0%) year-on-year
as sales at Accu-Time Systems, Inc.
in Nor th America decreased andsales at Horosmart, S.A. in Europe
remained at the same level on a yenbasis due to the effect of exchange
rates even though its sales increased
on a local currency basis owing to
the contribution from the access
control business acquired in the previous fiscal year.
As a result of the above, sales in thisbusiness division totaled ¥24,789
million, representing a decrease of
2.8% year-on-year.

Time Management Products
Although there is a constant demand for standard devices, thisbusiness division continues tocope with the current trend toward lower prices as well as theneed for improved functions.
In this mar ket environment, theCompany has been working on expanding its customer base throught h e “ U s e r- c l u b ” ( a f e e - b a s e d
ser vice for members), as well as
concentrating on expanding salesof time recorders equipped withaggregation software compatible
with PCs, which offers improved
6

usability and functionality.
Overall domestic sales for this fiscal year decreased by ¥94 million(3.0%) year-on-year as sales ofsupply goods such as time cards
declined. Overall overseas sales
fell by ¥294 million (22.7%) yearon-year as sales in North America
and Europe decreased althoughsales in Asia remained at the samelevel.
As a result of the above , sales
in this business division totaled¥3,818 million, representing a decrease of 8.3% year-on-year.

Parking Systems
To respond to the increasingly diverse needs of parking lot management in Japan, the Parking Systems
business division has been working
on improving the efficiency andreducing the cost of par king lot
management, increasing the levelof convenience for parking lot users, ensuring safety and security inparking lots, and integration with theInternet.
In response to these market conditions,the Company further strengthened
its cooperation with major parking
lot management firms and, at thesame time, concentrated on offeringvarious services to small to mediumsized parking lot management firms
through its parking lot data centers.
The Company has also worked to
improve the functionality and usability of its system equipment andmade effor ts to expand into newmarkets, such as bicycle parking systems, security-gate systems and tollroad systems, as well as strengthening proposals for improving parking lot management efficiency andmaking new proposals for enhancing
parking lot services to users.

During the current term for Amano,
on an unconsolidated basis, domestic par king equipment sales
increased by ¥2,532 million (14.6%)
year-on-year, due to increased order s for small to medium-sized
par king lots and bicycle par kinglots, and domestic sales generated
by maintenance contracts and supplies ser vices increased by ¥21
million (0.2%) year-on-year. Amano
Management Service Corporation’scommissioned parking lot management business has been steadily
expanding with increased sales, andthe number of parking spaces undermanagement increased by 41,300(12.0%) from the end of the previous fiscal year.
Overall overseas sales decreasedby ¥647 million (3.4%) year-on-year
as sales at Amano McGann, Inc. inNorth America declined on a yenbasis due to the effect of exchange
rates even though its sales increased
on a local currency basis and thecommissioned parking lot management business in Korea, Malaysia andHong Kong grew steadily.
As a net result of the above, theParking Systems business division
provided sales totaling ¥58,402 million, up by 4.7% year-on-year.

Environment System business• Environmental Systems:
Standard dust collectors, large
dust collection systems, pneumatic
powder conveyance systems, hightemperature hazardous-gas removal systems, and deodorization
systems• Clean Systems:
Cleaning equipment, dr y-carecleaning systems, cleaning management services, and electrolytic
water generators
The sales in this business totaled¥33,113 million, down by ¥930
million (2.7%) year-on-year. The following is a breakdown of sales bybusiness division.

Environmental Systems
In this business division, although
the Company’s capital investment
has remained solid in Japan, theoverseas business environment remained harsh as investment by Japanese companies was sluggish partly
due to a slowdown of the Chinese
economy.
In this mar ket environment, theCompany’s domestic strategy focused on capitalizing the demandfor its standard equipment bystrengthening proposals, mainly
targeting automobile-related companies, while seeking to win additional orders from customers in thepharmaceutical, foods and cosmetics
markets. Meanwhile, the Company
enhanced cooper ation with its
overseas Group companies, reinforced its platforms for engineering,sales and services. Furthermore, theCompany endeavored to achieve
greater cost competitiveness by expanding its local procurement, whileobserving the investment trend ofJapanese companies operating overseas.
During the current term for Amano,
on an unconsolidated basis, domestic sales of standard equipment increased by ¥157 million (2.2%), salesof large-scale systems increased by¥308 million (4.8%) and sales generated by maintenance contracts andsupplies services increased by ¥448
million (10.5%) year-on-year.
Overall overseas sales decreased by¥957 million (24.9%) year-on-year
as sales in Asia declined partly due
to the strengthening of the yen.
7

As a result of the above, sales of thisbusiness division totaled ¥21,712
million, down by 0.5% year-on-year.

Clean Systems
In Clean Systems, while the trend ofcompanies trying to reduce cleaning
costs continues domestically amid ashortage of sanitary workers in thebuilding maintenance industry, needs
for proposals that lead to higher
cleaning efficiency and improved
quality have been increasing.
In response to these market conditions, we strengthened our proposal,
addressing cleaning issues companies
are facing, through implementationof new cleaning techniques using
cleaning robots and the launch of
the new EG series automatic floor
scrubbers, which further increased
safety levels and improved usability.
For this fiscal year, even though
Amano’s domestic sales of new
products on an unconsolidated basis
fared well, overall domestic sales ofcleaning equipment decreased by¥28 million (1.3%) and domestic
sales generated by maintenancecontracts and supplies services declined by ¥128 million (4.8%) yearon-year.
Overall overseas sales decreasedby ¥584 million (9.1%) as sales inNorth America declined on a yenbasis due to the effect of exchange
rates even though sales in the region grew on a local currency basis
owing to a steady increase in thewooden floor sanding equipment
business.
As a net result of the above, salesof this business division totaled¥11,401 million, down by 6.7% yearon-year.

General Financial Condition
for This Fiscal Year
• Assets
Total assets as of March 31, 2017
amounted to ¥137,888 million, up by¥922 million from the previous fiscal
year-end. Current assets increased by¥1,762 million year-on-year. This was
attributable primarily to increases of¥2,052 million in cash and bank deposits and ¥556 million in merchandiseand finished goods despite a decreaseof ¥865 million in notes and accounts
receivable. Fixed assets decreased by¥840 million year-on-year. This was attributable primarily to a decrease of¥786 million in intangible fixed assets
due to a decline in goodwill despite anincrease of ¥99 million in tangible fixed
assets.
• Liabilities
Total liabilities as of March 31, 2017
amounted to ¥38,467 million, downby ¥2,891 million year-on-year. Current
liabilities decreased by ¥1,899 million
year-on-year. This was attributable primarily to decreases of ¥1,213 million in
short-term bank loans and ¥750 million
in accrued income taxes. Fixed liabilities
decreased by ¥991 million year-onyear. This was attributable primarily todecreases of ¥540 million in net defined
benefit liabilities and ¥301 million inlease obligations.
• Net Assets
Total net assets as of March 31, 2017
amounted to ¥99,421 million, up by¥3,814 million from the previous fiscal
year-end. This was attributable primarily to an increase of ¥4,314 million inshareholders’ equity resulting from therecording of net income attributable toowners of the parent company, despitea decrease of ¥541 million in accumulated other comprehensive income owing to lower foreign currency translation
adjustments, among other factors.

 eneral Cash Flows for ThisG
Fiscal Year
Consolidated cash and cash equivalents
increased by ¥2,544 million from theprevious fiscal year-end to a total of¥35,270 million as of March 31, 2017.
The status of each type of cash flow at
year-end and the underlying factors are
as follows.

• Cash flow from operating activities
Net cash provided by operating activities totaled ¥13,734 million. This was
attributable primarily to income before
income taxes amounting to ¥13,831
million, and depreciation and amortization amounting to ¥4,933 million, despite income taxes payments amounting
to ¥5,488 million.
• Cash flow from investing activities
Net cash used in investing activities totaled −¥4,684 million. This was
mainly because, despite the recordingof ¥9,011 million in proceeds fromwithdrawal of time deposits and ¥2,300
million in proceeds from redemptionof securities, the Company recorded
expenditures amounting to ¥8,601 million in time deposits, ¥3,109 million topurchase tangible fixed assets, ¥2,464
million to purchase intangible fixed assets, and ¥2,000 million yen to purchasesecurities.
• Cash flow from financing activities
Net cash used in financing activities
amounted to −¥6,256 million. This waschiefly due to the recording of expen-

8

ditures amounting to ¥3,906 million in
payment of dividends, ¥1,713 million
in repayment of finance lease obligations, and ¥1,195 million in repaymentof short-term bank loans, despite therecording of ¥1,602 million yen in proceeds from sale and leaseback.

Future Outlook
In the next fiscal year ending March 31,
2018, the Japanese economy will likely
remain on a moderate recovery trend
as capital investment as well as employment and wages will be on a firm footing owing to Olympic Games-related
demand and economic policies by theJapanese government while overseas,
uncertainties about the future of economic situations and exchange rates willremain due to policy management by
the U.S. administration and political situations in European countries.
Amid this business environment, Amano
Corporation and its Group companies
will set “The 2nd Stage Towards a 100year Company-Innovative Creation of
Value for Sustainable Growth” as its
management concept and work to address key issues in the new mediumterm management plan described in“3. Business Policies” on page 10 with aview to maximizing the corporate valueof Amano Corporation.
The following business results are projected for the next fiscal year ending
March 31, 2018: net sales of ¥126,000
million, operating profit of ¥13,800 million, ordinary profit of ¥14,300 million,
and net income attributable to parent
company shareholders of ¥9,400 million. These projections assume currency
exchange rates of ¥105 to the US dollar and ¥114 to the euro.

high-quality products, ser vices andsolutions, thereby gaining large market
shares in each sphere of business inJapan, North America, Europe, and Asia,and developing its business globally.
In the year ended March 31, 2017, theTime Information System business accounted for 72.4% of total sales, and theEnvironment System business accounted
for 27.6%. Before the deduction of unallocated expenses, the Time Information
System business contributed 70.8% tooperating profit, while the Environment
System business contributed 29.2%. In
terms of weighted average sales overthe last five years, the Time Information
System business accounted for 72.6% of
total sales and 74.3% of operating profit.
One future risk factor is that if market
expansion is forecast for a businessactivity within the Time Information System business segment (which accounts
for a large proportion of the Group’sbusiness) for such reasons as a signifi-

Operating and Other Risk Factors
Matters relating to the qualitative information contained in these summary
financial statements and relating to theconsolidated financial statements that
could be envisaged as having a possible
material impact on investors are described below.
Every effort are made to identify factorsthat may now or in the future pose arisk to the undertaking of business by
the Amano Group, and these risk factors are then eliminated or otherwise
managed in the course of business.
Forward-looking statements are current
as of the date of the release of thesefinancial results (April 26, 2017).
(i) Impact on earnings due to changes inthe business environment

The Amano Group uses the unique
technologies and know-how it has accumulated to provide customers withcant change in the demand structure or
the creation of a new market, entities inother industries or other powerful competitors may be tempted to enter themarket. In such an event, if a competitor
were to enter with innovative products
or solutions that surpass Amano’s, theAmano Group’s market advantage
would decline, which may have a material impact on its business performance.
(ii) Fluctuations in exchange rates

The Group engages in business activities
on a global scale and has production
and sales bases overseas. In view of this,the Group’s business results may be
impacted by fluctuations in exchange
rates when the proceeds for overseas
transactions are converted into yen.
(iii) Information security

In the course of providing system solutions and developing cloud businessservices (e.g., ASP, SaaS, and hosting services), the Amano Group handles con-

Reference: Trend of cash flow indicators
As of Mar. 31, 2013

As of Mar. 31, 2014

As of Mar. 31, 2015

As of Mar. 31, 2016

As of Mar. 31, 2017

Equity ratio (%)

69.8

67.6

69.8

69.5

71.8

Fair value equity ratio (%)

62.3

66.5

83.7

99.4

122.6

Ratio of cash flow to interest-bearing liabilities (%)

34.7

37.3

52.2

25.5

16.0

Interest coverage ratio

207.7

219.7

122.9

292.2

447.8

Notes :	Equity ratio: Equity capital/Total assets
Fair value equity ratio: Gross market capitalization/Total assets
Ratio of cash flow to interest-bearing liabilities: Interest-bearing liabilities/Cash flow from operating activities
Interest coverage ratio: Cash flow from operating activities/Interest payments
Assumptions
		* All indicators are calculated on the basis of consolidated financial values.
		* Gross market capitalization is calculated by multiplying the closing price of the Company’s shares at the year-end by the number of shares of common stock issued and outstanding at the year-end (less treasury stock).
		* The term “cash flow from operating activities” refers to cash flow from operating activities posted under the consolidated statements of cash flows. The term “interest-bearing liabilities” refers to those liabilities stated in the consolidated balance sheets on
which interest is paid. Interest payments equate with the interest paid recorded in the consolidated statements of cash flows9fidential information, such as personal
information concerning, or provided by,customers. In view of this, the Company has strengthened and thoroughly
implemented security control measures
based on the Information Security
Management Rules. Specifically, theCompany has implemented measures
to protect confidential information (e.g.,encrypting hard disk drives and external
media) as well as provided periodic staff
training through e-learning. Furthermore,
the Company obtained the Privacy
Mark certification in February 2014 andhas implemented all possible measures
to ensure information security, including
supervision of service providers andthorough compliance with internal rules.
Never theless, the occurrence of an
unforeseen situation that results in loss
or leakage of confidential or personal
information as described above could
have an adverse material impact on theGroup’s business performance due tofactors such as loss of confidence.

carrying out their duties.
(v) Overseas business development

The Amano Group has been developing its business globally in Japan, North
America, Europe, and Asia. Therefore,
there is a possibility that a situation
may arise in which business operations
are disrupted due to the applicationof unique laws, ordinances, or regulations or social disorder due to political
disturbances, war, or terrorism, etc. in
countries or regions where the Group
conducts business, which may adversely
impact the Group’s business performance.

(iv) Natural disasters

Natural disaster s (e.g., large-scale
ear thquakes, windstorms, or floods)
may damage human lives or property.
The Amano Group continues to takenecessary measures at ordinary times
comprising: 1) imposition of requirement for employees to carry a disasteremergency contact card at all times; 2)development of emergency contact
networks and personnel safety checksystem; 3) relocation of file servers toexternal data centers; 4) developmentof a preparedness for setting up the disaster management headquarters at thetime an emergency occurs. However,in the event of a natural disaster, theGroup may temporarily lose the ability
to continue to perform its operating
activities due to damage to its sales
business sites and production bases, orto employees experiencing difficulties in

10Topics
Parking Systems

Cleaning systems

Introduced a new bicycle locking system Rising orders for bicycle parking
systems!

Strengthen proposals for robotic
cleaners!

Bicycles are becoming increasingly popular
as a convenient method of commuting, attending schools and shopping. This trend
is also driven by more people becoming
health conscious and the spread of electric-motor assisted bicycles.
While new bicycle parking facilities areon the rise near train stations, in October
2016, Amano introduced a new userfriendly locking device. The new system
was introduced to the municipal (partly
privately owned) bicycle parking lots nearmost of the stations along the Aonami lineof the Seaside rapid transit railway and the
Meijo line of the municipal subway in Nagoya city.
In addition to the user-friendly parking
space, the system offers electronic fee settlements via pre-paid transportation cards,
which is a convenient feature for users on
the go.
From cars to motorcycles and bicycles,
adapting to the needs of the times, Amano
will seek to become a comprehensive
parking solution provider in hardware,
software, data center services and management services.

Participated in the “Haneda Airport
Robot Experiment Project 2016”
In recent years, expectations for robotic
cleaners are rising against the backdrop of
declining labor force in cleaning. In light ofthis situation, Haneda Robotics Lab organized this event which commenced in 15
December 2016, and Amano exhibitedits first robotic cleaner the “SE-500iX II”.
Heading towards the year 2020, this project aims to demonstrate that robots andusers can coexist. 17 companies specialized
in cleaning, mobility support and guidancewere selected to exhibit their solutions.
Haneda airpor t being the entrance toJapan, many Japanese and foreigners wereable to see and experience the robots at
work.
Amano will continue to strive to expand
the robotic cleaning market.

Amano’s second TV commercial is
now on air!
As par t of our effor ts to improve the
Amano brand value, we have begun airing
our second TV commercial. This time, thecommercial is more humorous compared tothe previous version where a father decides
to install a variety of Amano products at
his home. The features of the products aredescribed in the comical exchanges between
the father and the bewildered daughter.
Although Amano products are well known
to the working people, awareness among
general consumers remains relatively low. By
introducing our products in a humorous TVcommercial we are aiming to draw more attention and raise recognition.
The video clip of the commercial can beviewed on our website. http://www.amano.
co.jp/corp/movie.html

Information systems

Demonstrating the SE-500iX II

Clean systems

Bicycle locking system
Environmental systems

Parking systems

Gate type bicycle parking system

11

Amano USA Holdings, Inc.
Amano Cincinnati, Inc.
The ACI time division had a successful launch of its
latest data collection terminal line. The new MTX30 series was officially released 1st quarter 2017 toboth our dealer and retail channels. This new line ofterminals complements our existing data collection
portfolio. The MTX-30 series comes in a variety ofreader configurations such as fingerprint, proximity,
barcode and magstripe. All have direct and Ethernet
connectivity and the ability to output employee
punches to a memory stick. This is convenient for
remote locations. In addition to the new terminal
release we have made several enhancements to ourTime Guardian software.
This new combinationof robust terminal andenhanced software makesa perfect employee management solution for small
to medium sized business.
The Amano time division continues to look for
new and innovative sales channels. As the market
landscape changes, our traditional sales channels alsochange. We see growth in ecommerce sales versus
traditional brick and mortar store sales. This requires
a constant focus on marketing material like productvideos and high quality images. Customers now expect a virtual demonstration on most products they
view. We have partnered with a local marketing firm
to provide high quality digital images and productvideos.

Accu-Time Systems, Inc.
AICP
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Re
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anization C
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on
tr
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rv

S E R V I C E O R G A N I Z AT I O N S

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rm aicpa.org/soc oerlpy SAS 70 Re

Accu-Time Systems, Inc. (ATS) celebrated its 25thyear in business with continued growth in both theValue Added Reseller (VAR) and the TimeCom®
hosted middleware sales channels. The PeoplePoint
family of terminals continued to gain in popularity in2016 with a 14% increase in shipments compared tothe prior year. International shipments rose to 16%
of sales in 2016 representing a 4% increase overthe prior year. Record sales were generated in four
separate calendar months and profits continued to
be strong.
In 2016, ATS began development of enhancements
to our Maximus and Peoplepoint family of terminals. To address the needs of our customers andthe markets we serve, these enhancements provide
increased functionality with enhanced displays, fasterprocessors, increased memory and the developmentof terminals to operate on an Android platform. The
first of these enhanced terminals was the Peoplepoint Core which gained immediate acceptance withthe shipment of 1,500 terminals during its initial production year. These enhancements will position our
terminals to meet the constantly changing market
requirements including increased speed, validationand employee self-service.
Also in 2016, improvements to the TimeCom solution were released. The TimeCom solution includes
an ATS data collection terminal built to the highest
quality standards, hosting Cloud-based time clock
management middleware, and professional services.
The entire solution gives customers the best-in-classmethod for automating and validating the efficientcollection of time and attendance data from employees, as well as delivering employee self-service
functionality. The complete TimeCom solution
seamlessly integrates and exchanges time clock datacollected at the terminal with many human capitalmanagement (HCM), workforce management (WFM)
and enterprise resource planning (ERP) systems.
ATS launched TimeCom 5.0 in the beginning of
2016, followed later in the year with version 5.1. The
latest versions of our middleware significantly boost
performance, offer additional functionality with the
TimeCom Monitor and establish the ground work
towards a multi-tenant architecture. The enhanced
TimeCom Monitor allows customers to remotely
monitor data collection terminals on a global basis
and proactively identify potential problems. The
multi-tenant architecture will give Accu-Time Systems enhanced management capabilities and anincreased competitive advantage. TimeCom has seencontinued growth in both terminal sales as well as inprofessional services, with an increase of 34% in new
customers from previous years.
As a service organization, ATS is proud to display
the AICPA seal for successfully completing SOC 1
and SOC 2 audits conducted by an independent
service auditor resulting in two unqualified reports– SOC 1 Report on Controls at a Service Organization Relevant to User Entities’ Internal Control Over
Financial Reporting and SOC 2 Report on Controls
at a Service Organization Relevant to Security. The
attainment of these reports strengthened ATS’s
TimeCom position by enabling ATS to become
a Certified Solutions Partner of Workday, an ondemand financial management and human capitalmanagement software vendor. The Workday certification provides our TimeCom solution a distinct
competitive advantage yielding a stronger footing,positioning and visibility within Workday’s management, sales organizations and customer base as it
demonstrates our platform has met all the necessary
requirements.
In an effort to support customers in our expanding
footprint, ATS has partnered with a global service

12

organization to provide local, on-site support withover 2,000 employees and an increasing number
of affiliates. This partnership further demonstrates
our commitment to meet our customers’ needs andprovide them best-in-class service, further solidifying
ATS’s reputation for providing superior products andpremium support.

Amano McGann, Inc.
General Overview
Amano McGann, Inc. (AMI) continued growth in2016 with sales over and above the record revenues
set the prior year. The key driver for this growthcame from a 14% increase in branch project sales.

Change of the Guard
After more than 35
years of representing
the same product family,
AMI President Lawrence
Feuer announced his retirement. Mr. Feuer has helped shape the landscapeof the parking industry and has guided AMI throughseveral company acquisitions and major product line
rollouts, including OPUSeries® and Overture®.
President and CEO of sister company Amano Pioneer Eclipse Corporation, Tom Benton, was selected
as Mr. Feuer’s successor by Amano Corporation
Japan. Mr. Benton’s focus is to grow business by concentrating on quality products, improved customer
service and strong financial controls. The leadershiptransition took place on April 1, 2017.

Welcome to the Family
In August 2016, AMI acquired PG Park, Inc. in Ottawa, Canada. Utilizing PG Park’s existing resources
and connectivity in Canada, AMI has gained greater
access to a large geographical area and customer
base. The purchase of PG Park, now Amano McGann Canada, Inc.,
further strengthens ourpresence in the Canadianmarket and significantly
increases market shares.

What’s New?
ASymphony Analytics – Beta Testing
AMI’s Symphony Analytics harnesses the power,
flexibility and scalability of the Microsoft Cloud. Symphony Analytics allows
operators, portfolios anddevelopers to manage theirparking assets to their fullpotential as real-time data
can be accessed by any
internet-connected device
allowing end users to focus
on their assets anywhere,anytime. Findings show that
productivity and efficiency

could be increased by 15 to 20% while yield management is expected to significantly reduce traffic
congestion while realizing an estimated 30% increasein parking revenue through true space optimizationand dynamic pricing.
Microsoft CityNext Partner
AMI’s breakthrough Symphony Analytics is an example of Microsoft CityNext’s dedication to empower
cities to digitally transform through innovative, highimpact services. Symphony Analytics enables greatercollaboration between city, state, regional authorities
and privately owned and operated parking facilities.
With a collaborative ecosystem, cities can quickly
and efficiently move patrons to available public andor private parking with real-time guidance. Dynamic
pricing will help patrons select garages while maximizing revenues and pre-paid reservations will speed
through-put. This collaboration between public andprivate facilities is key to effectively managing congestion within a metropolitan area while at the sametime addressing the needs of citizens.
The Overture Movement
In a short 19 months, AMI has sold over 33 Overture projects ranging in size from 1 in/1 out to 14
lanes with four pay-on-foot terminals. Overture has
been implemented in four countries, 17 states and22 cities. Eight channel partners have sold two or
more Overture projects and seven locations have already been sold in Minneapolis, Minnesota. Overtureuses linear barcode technology, has a sleek, attractive
aesthetic and can accept EMV credit card payment
using Point to Point Encryption (in the United States
and Canada) which enhances payment security on
site.
AMI-1200 Direct Drive Gate
In February, 2017, AMI announced the release of ournext-generation gate, theAMI-1200 Series Universal
Barrier Gate. The design
incorporates support for the entire AMI family of
products, including OPUSeries, Universal Readers,
AMG Series and Overture. The new gate includes abattery to support “gate arm up on power fail” andthe new housing offers an architecturally attractive
metal hood and smaller footprint. Prior to release,
the AMI-1200 was deployed at strategic locations
throughout the United States and Canada which returned positive feedback. Shipments of the new gate
began in Spring, 2017.

Major Project Awards
Kyo-ya Hotels & Resorts
AMI obtained a multi-phase hotel PARCS project inHonolulu, Hawaii. OPUSeries equipment will replace
existing devices within the two Kyo-ya Hotels &Resorts parking structures supporting the Sheraton
Waikiki, Sheraton Princess Kaiulani, Moana Hoteland The Royal Hawaiian. The project includes theimplementation of
AMI’s iParcProfessional
Software Suite hotel
parking management
system and Genetec’s
license plate recognition (LPR) system. Hotel guests will have parking
access via their room keys and employees, associates
and contractors will have access via LPR credentials.
The installation of this new system is due to becomplete in the Summer of 2017 and will offer parking patrons faster throughput and scalable parking
management tools to effectively control all aspects of
their operations.
University of Wisconsin-Milwaukee
AMI was awarded the contract for the Universityof Wisconsin-Milwaukee campus parking systemsolution. OPUSeries devices with IP intercoms and
EMV credit card terminals will replace existing equipment. The project includes the implementation of
AMI’s iParcProfessional Software Suite with advanced
modules including Accounts Receivable, Debit Recharge, Digital Sign Control, MiParc, Negotiated Fee,
Roving Cashier, Shared Accounts and eParcSuite aswell as integrations with third-party platforms including Parkmobile and T2. Amano McGann network
video recorder security cameras are being integrated
to provide a full command center approach. Reservation parking and LPR are in the process of being
added to the system. The changes will be made tofour of the parking facilities on campus with the intent to extend to additional lots in the future. Once
implemented, students and faculty will use their
University ID’s for parking access and can add value
quickly and easily at the pay-on-foot stations.

new look of the machine,
the FloorCrafter went
through an intensive
improvement process tomake it the strongest belt
machine on the market.
At the 2016 ISSA Interclean show in Chicago,
Pioneer Eclipse launched two new products including
the AquapHyll Quad Dilution Control System andthe 225BU Corded Burnisher. The burnisher, manufactured in the Sparta, NC plant, reinforces APEC’s
position as the world leader in burnishing technology. The 225BU was released in both standard anddust control versions. The cleaning chemical category
performed well in 2016, led by 30% growth in theprivate label segment.
Another large portion of APEC growth in 2016 wasdriven by APEC’s Amano Environmental Americas
business, which grew 173% due to a large contract
with Hankook Tire. The Hankook Tire project wascompleted in February and the AEA business finished
the year 8% above budget.
In the last quarter of the year, construction wascompleted on a 10,000 square foot expansion to the
Sparta, North Carolina warehouse and manufacturing
facility. A ribbon cutting was held in February during the annual
GSC meeting, which
was hosted by APEC
in North Carolina.

Amano Pioneer Eclipse Corporation

Amano Europe, N.V.

Amano Pioneer Eclipse Corporation (APEC), which
manufactures and sells products under the Pioneer
Eclipse, American Sanders and Amano Environmental brands, had a record year of revenue and pre-tax
profit in 2016. The growth rate of 8% surpassed theplanned and previous year financial performance andmarked the seventh consecutive year of growth for
APEC.
The Wood Floor side of thebusiness experienced strong
sales in both the Professional
and Rental channels, growing 13% in 2016. American
Sanders launched a new lineof vacuums with the AVAC
26 and the AVAC 12 dust
containment systems. Both products have been wellreceived in the marketplace and have experienced
higher than anticipated sales volumes.
At the annual sales meeting in January, American
Sanders relaunched its belt machine, the FloorCrafter, in a matte black finish. In addition to the13

Amano Europe Holdings, N.V.
In 2016 Amano Europe continued to grow bothrevenue and profit in the main business segments;
parking solutions and time and attendance.
The X-Parc parking solution has been installed successfully in 36 countries worldwide in a variety ofbusiness segments like airports, hotels, hospitals,
retail, leisure and municipalities. With X-Parc Amano
offers a robust, flexible and network centric parking
solutions that can be easily integrated in 3rd party
solutions. The traditional VALUE-Line has been
extended with an ECO-Line to serve niche markets
and recently also with a SMART-line focusing on
cloud solution and mobile services like e-ticketing,scan and pay, reservation services and mobile POS.
Ease of integration, lowcost of ownership, fasttime to market, andquality assurance are
the four cornerstones
to drive success. With
X-Parc range, Amano
Mobile App

is positioning itself in the global mobility market as asolution and service provider.
Astrow Cloud, the next generation of the proven
T&A software solution for small andmedium sized businesses with an
installed base of more than 5.000
customers in Europe and Africa, isgetting widely accepted. As a result,a record high growth was recorded
in 2016. Focusing on Mobility, FlexMobile APP
ibility and Appeal, Amano also
for CloudUsers
launched the Astrow-APP in 2016.

Amano Time & Parking Spain, S.A.
IOur marketing campaign to the hotel sector that westarted in 2015 to find out a new niche in our market finally brought us good results in 2016. A 4-star
hotel located in Madrid decided to replace theirparking machines from our competitor by our XParc, which were installed in June ’16. The customer,
owner of the hotel, appreciating very much the quality of X-Parc products and our sales and technicalteam, requested us to make quotations for 3 more
hotels of them, one of which is categorized five stars.
Our offers were accepted at the end of the year andin 2017, we will have 3
more hotels in Madridwith X-Parc machines
installed.
Thus, we have expanded
our market, while keeping our existing customers and business. We willseek for more continuity
and more ingenuity inour business.

Horoquartz, S.A.
2016 : robust growth and well oriented prospects.
2016 was not only a year of strong growth for
Horoquartz, reinforcing our number one position in
France, but also a year devoted to prepare future.
Workforce management solution sales are steadily
progressing particularly in the field of HR advanced
scheduling. R&D investments made over the last few
years are now bearing fruit in the distribution andhealthcare sectors as well as in the industrial field,
especially in the food industry, and certain service
sectors. A strong growth of demand is observed
from public sector and local authorities that needto streamline HR processes and cut costs. Thus
Horoquartz became the main supplier of the French
Ministry of Defence for their WFM solutions.
With eTemptation, Horoquartz now has a single
comprehensive solution that integrates all the scheduling, time management and activity tracking capabilities. This ability to cover the overall customer needs
is attracting more and more medium sized and large
accounts.

Growth was also driven by a range of new services
offered by Horoquartz. More than one new customer out of three is now opting for SaaS mode.
The associated services contracts are growing fast.
Horoquartz’s customers are increasingly subscribing
to the TPM service offer (Third Party Maintenance)in order to delegate to Horoquartz the maintenanceand evolution of their solution. Horoquartz has justannounced two major innovations in the field of
WFM; the new 5.4 version of eTemptation is now
offered with a fully renewed user experience andProcess4people a new solution that aims at automating the administrative HR processes. It will complement both the workforce management and security
solutions offered by Horoquartz.
In 2016, Horoquartz also set up a new organization
for its Access Control division closely aligned to theneeds of the market both for sale and technical services. Some key innovations have been announcedwith new biometric solutions, an emergency evacuation management solution and also a solution for
managing company carparks. This solution wasrecently rewarded withan innovation award
from the “Security Meetings Group”.

Amano Parking Service Ltd.
Amano Parking Service Limited hastaken up a new car park contract forKingston Terrace from 1st May 2017.
Kingston Terrace is a residential project developedby the Hong Kong Housing Society. Initially, it was a
project under the Sandwich Class Housing Scheme
for the HKSAR Government when it was completed in year 2002. As the Sandwich Class Housing
Scheme was suspended in year 2000, the project
was then changed to a private residential projectwith the Government’s approval and was put into
the market for open sale in year 2007.
Situated at Tuen Mun, thewestern part of the New Territories, Kingston Terrace comprises of 4 blocks with a totalof 1,152 flats ranging in the size

14

between 55 M2 and 83M2. The car park has 3 levels
and comprises of 251 spaces for private cars, 13 formotorcycles and 4 for lorries. Amano’s Xparc systemwith directly integrated Octopus payment feature
is installed immediately after APS has taken up thecontract.

Amano Malaysia Sdn. Bhd.
The world’s largest furniture retailer
has become Amano Malaysia’s loyal
customer.
We have delivered parking systems to approximately
250 sites, mainly in commercial facilities and oursystem has been adopted by many facilities which
operate nationwide.
For this year’s topic we would like to present IKEA,
the world’s largest furniture retailer. Currently IKEA
operates 2 stores in Malaysia, both using Amano
parking systems. The first store opened in 2003,
which at the time was the largest IKEA store in Asia,and they continue to use our system.
The second store opened in November 2016 proximate to a large shopping mall and this time Amano
successfully installed the same parking system in thisshopping mall as well. The parking complex has 4levels above ground and 2 levels underground andtogether with IKEA‘s parking (2 levels underground),it houses 6,200 parking bays. The parking systemconsists of 16 entry ticket dispensers, 14 exit readersand 31 automatic pay stations.
Currently installation works are underway at IKEA’s
third store. For this system, we are collaborating with
our sister company Amano Korea Corporation todeliver their LPR system and expect the operations
to commence in November 2017. We have beenhappily informed by IKEA that the reason for theircontinued use of Amano products is because Amanois capable of conforming to the stringent installation
specifications and diligent schedule control by IKEA.
In addition, we are bidding for the parking system
for the planned shopping mall near the third IKEA
store along with the forth IKEA store. Our sales andtechnical teams are working hard as a united force toprovide the highest quality of service to existing sites
as well as the site under construction so as to win
further deals.

Parking Systems:
SAMSUNG R&D CENTERLG SCIENCE PARK

1

LPR

9

20

2

Gate

9

20

3

Ticket Dispenser

5

-

4

Ultra Sonic Sensors

2,214

4,870

5

Guiding Lights

682

1,623

Korea’s largest enterprise, Samsung Electronics, established a new R&D center in Seocho-gu, Seoul andKorea’s 4th largest enterprise, LG group also built thecountry’s largest research complex the “LG Science
Park” in Magok industrial park in Seoul. AKC exclusively won orders to install parking systems for both.
In the case of Samsung, AKC was chosen becauseof our excellent track record as a cooperative company and in the case of LG, the reasons were AKC’s
leading position in the industry, technical capabiities
and the reliability of their products. Samsung and LG
are regarded as symbolic enterprises who will drive
technological innovation indispensable for economic
development, which is an important agenda of
the Korean Government. Winning deals with suchprominent enterprises will further raise the presenceof AKC.

As a result of AKC’s ongoing differentiation marketing efforts they have developed Mobile Applications
for parking reflecting the needs of customers for
improved convenience. The launch of these applications is already contributing to the expansion of thebusiness.
(1) Mobile pay device for on-street parking

The Mobile pay device for on-street parking wasdeveloped as a substitute of the existing PDA (Personal Digital Assistant) device and is equipped with a
LPR module. By recognizing the parking bay and thelicense plate, parking fees can be automatically calculated upon specifying the parking space when exiting.
It is also possible to choose cash or credit card for
payment.
(2) Mobile pre-settlement to avoid congestion

5

Occupying
AffiliatedCompanies

6

Building

SAMSUNG R&D CENTER
330,000m²
155,600m²
2016
2,214
Samsung Seocho office,Samsung Design Management Center,
Samsung Software,Samsung DMC Laboratory,
6 Buildings: 10 levels above
ground, 5 levels underground

LG SCIENCE PARK
1,114,809m²
176.625m²
Sometime in 2017
4,870
LG Electronics, LG Display, LG Innotech,
LG Chemical, LG Household & Health Care,LG Life Sciences, LG Uplus,LG CNS,
LG Hausys, Serveone
6 Buildings: 10 levels above ground
12 Buildings: 9 levels above ground

AKC was selected as the installer of Electric Vehicle(EV) charging devices for 2017 in accordance with
the Government policy to popularize EVs.
AKC’s Smart Charge LPR is an integrated systemenabling charging and LPR parking. Parking fees andelectricity fees can be settled simultaneously. AKC
is the only manufacturer in Korea that offers thissystem and as such patent registration has been
completed.
Vehicleoccupancy
indicator

Charging
connector

CamerasUltra
sonic
sensors
Patent No.
10-1729450

In the event of exit congestion due to rush hour traffic and/or system malfunctions, by using the Mobile
pre-settlement, the parking controller can scan thelicense plate of vehicles standing by for exit to expedite fee settlements. It is also possible to choose cash
or credit card for payment.

Outline:Items
otal Area
Site Area
Opening
Parking Bays

The AMANO IPS is a system that realizes further
sophistication of parking lots utilizing mobile applications which are currently managed by AKC. Authorized controllers can access real time sales data,
make historical comparisons, and grasp vehicle entry& exit status which is useful for optimum staff allocation. The system also enables trouble calls, visualmonitoring and remote gate control.

Great interest for AKC’s Smart Charge
LPR which conforms to the Korean
Government policy to promote electric vehicles(3) Simple settlement system using QR codes

1
2
3
4

(4) AMANO IPS (Intelligent Parking System)

AKC’s differentiation marketing strategy – Developed Mobile Applications
for Parking!

Amano Korea Corporation
AKC won exclusive orders to installparking systems in innovative research
centers built by leading Korean enterprises

pay station, a pop-up will appear on the mobile device to enter the license plate number. Parking fees
can be settled on the mobile device by entering thelicense plate number.

The Mobile Applications described in (1) and (2)are for the parking controller. This QR code simple
settlement system is for the parking user.
By scanning the QR code attached to the unmanned

15

The Smart Charge LPR will be installed in the parking
lot of Incheon International Airport. The installation is
expected to be completed in 2017. As the state-ofthe-art system conforming the Government’s policy
to promote EVs, it is drawing attention from various
fields.

AMANO Corporation and Subsidiaries

Financial Highlights
For the year ended March 31, 2017
Yen in millions and U.S.dollars in thousands, except per share amounts- See Note 4 to the Consolidated Financial Statements.
Thousands of U.S.dollars(Note 4)

Millions of Yen

2017

2016

2017

Net sales...................................................................

¥120,124¥119,506$1,072,538

Net income................................................................

9,223

8,405

82,355

Net income per share (Basic)......................................

¥120.79¥109.75$1.078Cash dividends per common share..............................

52.00

48.00

0.464

For the years ended March 31:

Per share data (Yen and U.S. Dollars):

At March 31:
Total assets...............................................................

¥137,888¥136,965$1,231,150

Working capital.........................................................

55,40451,741

494,683

Total net assets..........................................................

99,421

95,606887,692

Time information systems..........................................

¥24,789¥25,512$221,337

Time management equipment ...................................

3,818

4,165

34,091

Parking systems ........................................................

58,40255,784

521,452

Environmental systems .............................................

21,712

21,830193,861

Cleaning systems ......................................................

11,401

12,213

101,797

Sales by product:

Note: U.S. dollar amounts have been translated at the rate of ¥112 = US $1, the rate prevailing on March 31, 2017.
- See Note 4 to the Consolidated Financial Statements.

Net Sales

Net Income

Net Income Per Share(Millions of Yen)

(Millions of Yen)

(Yen)

13000010000

1401200009000

110000
90000

7000

80000

6000

70000

100
80

5000

60000
50000

4000

40000

3000

30000

60
40

2000

20000

20

1000

10000
0

120

8000

100000

'13

'14

'15

'16

'17

0

'13

'14

'15

16

'16

'17

0

'13

'14

'15

'16

'17

AMANO Corporation and Subsidiaries

Consolidated Balance Sheet
As at March 31, 2017
Thousands of U.S.dollars(Note 4)

Millions of Yen

ASSETS

2017

2016

2017

Cash and bank deposits (Notes 6, 11 and 15)..............

¥38,940¥36,888$347,687

Marketable securities (Note 15)..................................

1,435

1,527

12,81433,71034,576300,991

Current assets:

Notes and accounts receivable:
Trade (Note 15) ....................................................
Less allowance for doubtful accounts ....................

(357)

(314)

(3,195)33,35334,262

297,796

3,753

3,197

33,514Inventories:
Merchandise and finished goods ............................
Work in process ...................................................

477

669

4,266

Raw materials and supplies ...................................

5,227

4,992

46,678Deferred tax assets (Note 17)......................................

1,889

1,783

16,870

Other current assets ..................................................

2,560

2,554

22,864

Total current assets ...............................................

87,63885,875

782,488

Buildings and structures (Note 6)................................

30,16629,338269,343

Machinery and equipment .........................................

19,76819,182

176,503

Leased assets (Note 14)..............................................

6,330

6,899

56,51856,26455,420502,364

Less accumulated depreciation ..........................

(40,029)(39,637)(357,402)

16,235

15,782

144,962

7,125

7,170

63,622

Property, plant and equipment, at cost:

Land ........................................................................
Construction in progress ............................................

327

636

2,928

Total property, plant and equipment ......................

23,68923,589211,512Goodwill ..................................................................

3,165

4,088

28,260Software ...................................................................

3,322

2,521

29,663

Software in progress ..................................................

2,989

3,252

26,688Other intangible fixed assets ......................................

3,013

3,414

26,909Total intangible fixed assets ..................................

12,49013,276

111,520

Intangible fixed assets :Investments and other assets:
Investments in unconsolidated subsidiaries and affiliates(Notes 5 and 15) .......................................................

1,710

1,771

15,268Investments in securities (Note 15).............................

6,376

6,226

56,937

Leasehold and guarantee deposits ..............................

1,142

1,122

10,198Deferred tax assets (Note 17)......................................

1,273

1,646

11,374

Other assets (Note 6)................................................

3,995

3,867

35,677Less allowance for doubtful accounts .........................

(428)

(410)

(3,823)

Total investments and other assets ........................

14,07014,223

125,630

Total assets............................................................................

¥137,888¥136,965$1,231,150

17

Thousands of U.S.dollars(Note 4)

Millions of Yen

LIABILITIES AND NET ASSETS

2017

2016

2017

Current liabilities:
Trade notes and accounts payable (Note 15)...............
Electronically recorded monetary claims (Note 15)......
Short-term bank loans (Note 6) ..................................
Lease obligations (Notes 14 and 15) ...........................
Accrued bonuses for employees .................................
Accrued bonuses for directors ....................................
Accrued income taxes ...............................................
Other current liabilities ..............................................
Total current liabilities ..........................................

¥7,629
6,580
37
1,391
2,204
90
2,581
11,71932,234¥7,642
6,438
1,250
1,448
2,263
85
3,332
11,67334,134$68,11758,757336
12,423
19,684804
23,049104,636
287,805

Long-term liabilities:
Long-term loans payable (Note 15) ............................
Liability for retirement benefits (Note 16)..........................
Long-term accounts payable ......................................
Lease obligations (Notes 14 and 15) ...........................
Deferred tax liabilities (Note 17).................................
Asset retirement obligations ......................................
Other long-term liabilities...........................................
Total long-term liabilities ......................................
Total liabilities ......................................................

469
2,445
21
2,954
8
31
302
6,233
38,467

506
2,986
160
3,256
9
30
275
7,225
41,3594,189
21,838196
26,38274
277
2,696
55,653
343,459

18,23919,29365,075

18,23919,29359,757

162,853
172,260
581,028(1,059)101,548(56)
97,233(9,461)
906,681

1,934(3,533)(986)(2,585)

1,456(2,321)(1,178)(2,043)

17,276(31,549)(8,809)(23,082)

Non-controlling interests in consolidated subsidiaries .....

458

416

4,093

Total net assets......................................................
Total liabilities and net assets ...............................................

99,421¥137,888

95,606¥136,965

887,692$1,231,150

Net assets (Notes 9 and 10):
Shareholders' equity:
Common stock
Authorized - 185,476,000 shares
Issued:March 31, 2017 and 2016 - 76,657,829 sharesin 2017 and 2016 ..............................................
Capital surplus .....................................................
Retained earnings .................................................
Treasury stock at cost, 607,651 shares in 2017and 68,109 shares in 2016 ...................................

Accumulated other comprehensive income:Net unrealized gains (losses) on other securities......
Foreign currency translation adjustments ...............
Retirement benefits liability adjustments ................

The accompanying notes are an integral part of these statements.

18

AMANO Corporation and Subsidiaries

Consolidated Statement of Income, andConsolidated Statement of Comprehensive Income
For the year ended March 31, 2017

Consolidated Statement of Income
Thousands of U.S.dollars(Note 4)

Millions of Yen

Net sales
Cost of sales (Note 8) ...........................................................
Gross profit ..........................................................
Selling, general and administrative expenses (Notes 7 and 8).....
Operating income .................................................
Other income ( expenses ):Interest and dividend income .....................................
Interest expense ........................................................
Equity in earnings of affiliates ....................................
Foreign exchange gain (loss) .....................................
Gain on sale of fixed assets ........................................
Loss on disposal of fixed assets ..................................
Loss on sale of fixed assets ........................................
Gain on sale of investments in securities (Note 15)......
Gain (loss) on sale of shares of consolidated subsidiaries andaffiliates .....................................................................
Loss on liquidation of subsidiaries .............................
Impairment loss on fixed assets (Note 12)...................
Other, net .................................................................
Income before income taxes and non-controlling interests .....
Income before income taxes and non-controlling interests .........
Current .....................................................................
Deferred ...................................................................
Income before non-controlling interests .................
Non-controlling interests in net income of consolidated subsidiaries .....
Net income............................................................

2017

2016

2017

¥120,124
68,18051,94338,778
13,165¥119,506
68,12051,38538,442
12,942$1,072,538
608,757
463,781346,234
117,547

238
(30)
71
(89)
3
(24)
(19)
100

249
(46)
148
(80)
5
(71)
(28)
–

2,126
(276)
638
(803)
31
(218)
(175)
896

–
(35)
–
452
13,831

(8)
–
(236)
439
13,314

(314)
–
4,042
123,497

4,490
26
9,314
(90)
¥9,223

5,208
(411)
8,517
(111)
¥8,40540,091
240
83,167(812)$82,355–

Consolidated Statement of Comprehensive Income
Millions of Yen

Income before non-controlling interests ................................

Thousands of U.S.dollars(Note 4)

2017

2016

2017

¥9,314¥8,517$83,167

Other comprehensive income (loss) (Note 13):
Net unrealized gains (losses) on other securities .........
Translation adjustments ............................................
Retirement benefits liability adjustments ....................
Share of other comprehensive income (loss) of companies
accounted for by the equity method.................................
Total other comprehensive income (loss) .................
Comprehensive income ........................................................

484(1,219)192(82)(1,267)
(356)

4,326
(10,891)
1,715

(6)
(549)
¥8,765(17)(1,723)¥6,793(57)(4,907)$78,260

Total comprehensive income attributable to:Shareholders of the Company ....................................
Non-controlling interests ...........................................

¥8,681¥83¥6,713¥80$77,516$744

The accompanying notes are an integral part of these statements.

19

AMANO Corporation and Subsidiaries

Consolidated Statement of Changes in Net Assets
For the year ended March 31, 2017
Millions of Yen
Shareholders’ equity
Common stock

Capital surplus

Retained earnings

Balance at April 1, 2016
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

¥18,239¥19,293¥59,757––

Balance at March 31, 2017¥18,239¥19,293

Balance at April 1, 2016
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year
Balance at March 31, 2017

(3,906)
9,223

5,317

(1,002)

4,314¥65,075(¥1,059)¥101,548

Total net assets¥95,606478
478(1,212)(1,212)

192
192

(541)
(541)

42
42

(3,906)
9,223(1,002)
(499)
3,814

¥1,934(¥3,533)(¥986)(¥2,585)¥458¥99,421

Thousands of U.S. dollars (Note 4)
Shareholders’ equity
shareholdCapital surplus Retained earnings Treasury stock Totalers’ equity$172,260$533,548($506)$868,156

Balance at April 1, 2016
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

$162,853––

Balance at March 31, 2017

$162,853$172,260

Balance at March 31, 2017

(1,002)(3,906)
9,223(1,002)

Accumulated other comprehensive income
Non-controllinginterests in
Net unrealized Foreign currency
Retirement
Total accumulated
gains (losses) on
translation
benefits liability other comprehensive consolidated
subsidiaries
other securities
adjustments
adjustments
income (loss)¥1,456(¥2,321)(¥1,178)(¥2,043)¥416

Common stock

Balance at April 1, 2016
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

Total shareholders’equity(¥56)¥97,233

Treasury stock(34,875)(34,875)

82,355(8,955)82,355(8,955)47,480(8,955)38,525$581,028($9,461)$906,681

Accumulated other comprehensive income
Non-controllinginterests in
Net unrealized Foreign currency
Retirement
Total accumulated
gains (losses) on
translation
benefits liability other comprehensive consolidated
subsidiaries
other securities
adjustments
adjustments
income (loss)$13,008($20,726)($10,524)($18,242)$3,717

Total net assets$853,631(34,875)

4,268
4,268

(10,822)(10,822)

1,715
1,715

(4,839)(4,839)375
375

82,355(8,955)(4,464)34,061$17,276($31,549)($8,809)($23,082)$4,093$887,692

20

Millions of Yen
Shareholders’ equity
Common stock

Capital surplus

Retained earnings

Treasury stock

Balance at April 1, 2015
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year

¥18,239¥19,293¥54,645(¥54)

Total shareholders’equity¥92,123(2)(3,293)
8,405
(2)

–

–

5,112

(2)

5,109

Balance at March 31, 2016

¥18,239¥19,293¥59,757(¥56)¥97,233

Balance at April 1, 2015
Changes during the year
Dividends from surplus
Net income
Purchase of treasury stock
Net changes in items other than shareholders' equity
Total changes during the year
Balance at March 31, 2016

(3,293)
8,405

Accumulated other comprehensive income
Non-controllinginterests in
Net unrealized Foreign currency
Retirement
Total accumulated
consolidated
gains (losses) on
translation
benefits liability other comprehensubsidiaries
other securities
adjustments
adjustments
sive income (loss)¥1,542(¥1,070)(¥822)(¥350)¥375

Total
net assets¥92,148(85)(85)(1,250)(1,250)

(356)
(356)

(1,692)(1,692)40
40(3,293)8,405(2)(1,651)
3,457¥1,456(¥2,321)(¥1,178)(¥2,043)¥416¥95,606

The accompanying notes are an integral part of these statements.

21

AMANO Corporation and Subsidiaries

Consolidated Statement of Cash Flows
For the year ended March 31, 2017
Millions of Yen

Cash Flows from Operating Activities:
Income before income taxes and non-controlling interests ......
Depreciation and amortization ...................................
Amortization of goodwill ...........................................
Impairment loss on fixed assets .................................
Increase (decrease) in liability for retirement benefits .....
Increase (decrease) in allowance for doubtful accounts .......
Interest and dividend income .....................................
Equity in earnings of affiliates ...................................
Interest expenses ......................................................
Foreign currency translation (gain) loss ......................
(Gain) loss on sale of fixed assets ..............................
Loss on disposal of fixed assets ......................................
(Gain) loss on sale of investments in securities............
(Increase) decrease in trade notes and accounts receivable .......
(Increase) decrease in inventories ......................................
Increase (decrease) in trade notes and accounts payable........
Others .......................................................................
Subtotal ......................................................................
Interest and dividends received .........................................
Interest paid .............................................................
Income taxes paid .....................................................
Income taxes refunded...............................................
Net cash provided by operating activities ...............
Cash Flows from Investing Activities:
Payment for purchase of marketable securities ...........
Proceeds from redemption of marketable securities ............
Payment for purchase of property, plant and equipment ......
Proceeds from sale of property, plant and equipment ..........
Payment for acquisition of intangible assets ...............
Payment for acquisition of investments in securities ...........
Proceeds from sale of investments in securities ...........
Increase in time deposits ...........................................
Decrease in time deposits ..........................................
Payment for acquisition of investments in subsidiaries resulting in change
in scope of consolidation .....................................................
Proceeds from sale of investments in subsidiaries and affiliates.........
Payment for business acquisition ...............................
Collection of loans ....................................................
Others ......................................................................
Net cash used in investing activities .......................
Cash Flows from Financing Activities:
Repayment of short-term bank loans ..........................
Repayment of long-term debt .....................................
Payment for acquisition of treasury stock ...................
Repayments of finance lease obligations .....................
Proceeds from sale and leaseback ..............................
Dividends paid ..........................................................
Dividends paid to minority interests............................
Net cash used in financing activities ......................
Effect of exchange rate changes on cash and cash equivalents.......
Net increase (decrease) in cash and cash equivalents ..............
Cash and cash equivalents at beginning of year .......................
Cash and cash equivalents at end of year (Note 11)..................
The accompanying notes are an integral part of these statements.

22

Thousands of U.S.dollars(Note 4)

2017

2016

2017

¥13,831
4,933
684
–
(225)
81
(238)
(71)
30
(27)
16
24
(100)
309
(813)
266
278
18,980266(30)(5,488)
6
13,734¥13,314
4,415
789
236
19
105
(249)
(148)
46
3
22
71
–
(2,049)
(297)
544
513
17,337308(45)(4,214)34
13,420$123,497
44,053
6,109–(2,012)727(2,126)
(638)
276
(243)
144
218
(896)
2,764
(7,266)
2,378
2,489
169,473
2,383(274)(49,004)54
122,633(2,000)2,300(3,109)23(2,464)(108)
400(8,601)9,011(2,000)2,400(2,906)73(3,270)(603)–(10,133)
10,364(17,857)
20,536(27,761)206(22,001)
(965)
3,576
(76,799)
80,463

(62)
–
–
3
(78)
(4,684)

(410)
216
(235)
5
(109)
(6,608)

(560)
–
–
34
(700)
(41,829)(1,195)(1,002)(1,713)
1,602(3,906)(41)(6,256)(248)
2,544
32,725¥35,270

(341)
(215)
(2)
(1,643)
1,227(3,293)(39)(4,308)(304)
2,199
30,526¥32,725(10,677)–(8,955)(15,295)
14,307(34,875)(368)(55,864)(2,223)22,717292,194$314,912

AMANO Corporation and Subsidiaries

Notes to the Consolidated Financial Statements
1. Basis of Consolidated
Financial Statements
The accompanying consolidated
financial statements of AMANO
C o r p o r a t i o n [ h e r e a f t e r, “ t h eCompany”] and its subsidiaries
have been prepared in accordancewith the provisions set forth in theJapanese Financial Instruments
and Exchange Act and its related
accounting regulations in Japan.
The accounts of the Company anddomestic subsidiaries included in
the consolidation are based on theaccounting records maintained inaccordance with accounting principles
generally accepted in Japan, which
are different in certain respects as tothe application and the disclosure
requirements of International Financial
Reporting Standards. As permitted
by the Financial Instruments andExchange Act, amounts of less than
one million yen have been rounded
off. As a result, the totals shownin the accompanying consolidated
financial statements (both in yen
and U.S. dollars) do not necessarily
agree with the sums of the individual
amounts. Certain amounts in the prioryear’s financial statements have been
reclassified to conform to the current
year’s presentation.

2. Principles of Consolidation(1) Scope of Consolidation
The Company had 27 consolidated
subsidiaries at March 31, 2017. The
accompanying consolidated financial
statements include the accounts of theCompany and those of its subsidiaries
that are controlled by the Company.
Under the control concept, major
subsidiaries in which the Company isable to exercise control over operations
are to be fully consolidated. The
accounts of the overseas consolidated
subsidiaries are consolidated using
their financial statements as of theirrespective fiscal year end, which falls

on December 31, 2016 and necessary
adjustments are made to their financial
statements to reflect any significant
transactions from January 1 to March
31, 2017. All significant intercompany
balances and transactions have been
eliminated in consolidation.

(2) Accounting for Investments in
Unconsolidated Subsidiaries
and Affiliates
None of the 3 unconsolidated
subsidiaries are accounted for by theequity method, because the effect of
their net income or losses and retained
earnings on the accompanying
consolidated financial statements isimmaterial. The corporate name of @Park Korea Co., Ltd. was changed to
Mobile Parking Ltd. during the fiscal
year ended March 31, 2017. Amano
Manufacturing Shanghai Co., Ltd.
was liquidated during the fiscal year
ended March 31, 2017. The affiliates
accounted for by the equity method
are listed below: - Creo Co., Ltd.

3. Summary of Significant
Accounting Policies(1) Cash and Cash Equivalents
Cash and cash equivalents consist of
cash on hand, cash in banks which can
be withdrawn at any time and shortterm investments with a maturity of
three months or less when purchased
which can easily be converted to cash
and are subject to little risk of change invalue.

(2) Inventories
Inventories are stated at cost (writedown
due to reduced profitability). Cost isdetermined principally using the periodic
average method.

(3) Property, Plant andEquipment
Property, plant and equipment are statedat cost, less accumulated depreciation.
Depreciation is computed on the
declining balance method, based on23

the estimated useful lives, except forbuildings acquired on or after April
1, 1998 and for facilities attached tobuildings and structures acquiredon or after April 1, 2016, which
are computed on the straightline
method . The ranges of the useful
lives of assets are: Buildings andstructures 5-50 years Machinery andvehicles 7-17 years Normal repairs
and maintenance, including minor
renewals and improvements, arecharged to income as incurred.

(4) Intangible Assets
Intangible assets are amortized using
the straight-line method. Software
costs for internal use are amortizedby the straight-line method over their
expected useful lives (five years).
Software developed for external saleis amortized over the estimated sales
period, 3 years. Goodwill is amortizedover the estimated useful life, or where
the amount of goodwill is immaterial,is charged to income in the year ofacquisition.

(5) Leased Assets
Leased assets in finance leasetransactions not involving transferof ownership are depreciated by thestraight-line method over the term of
the lease, with a residual value of zero.

(6) A ccounting for Financial
Instruments(a) Derivatives
All derivatives are stated at their fairvalues, with changes in fair value
included in net profit or loss for theperiod in which they arise.
(b) Securities
Securities held by the Company andits subsidiaries are classified into four
categories; Trading securities, which
are held for the purpose of generating
profits on short-term differences inprices, are stated at their fair values,
with changes in fair values included
in net profit or loss for the period
in which they arise. Additionally,securities held in trusts for trading
purposes are accounted for in thesame manner as trading securities.
Held-to-maturity debt securities, that
the Company and its subsidiaries
have intent to hold to maturity, arestated at their costs after accounting
for any premium or discount on
acquisition, which are amortized overthe period to maturity. Investmentsof the Company in equity securities
issued by unconsolidated subsidiaries
and affiliates are accounted for by
the equity method. Exceptionally,
investments in certain unconsolidated
subsidiaries and affiliates are stated atcost because the effect of applicationof the equity method would be
immaterial. Other securities for whichmarket quotations are available arestated at fair value. Net unrealized
gains or losses on these securities arereported as a separate item in the net
assets section at a net-of-tax amount.
Other securities for which market
quotations are unavailable are stated atcost, except as stated in the paragraphbelow. In cases where the fair value ofheld-tomaturity debt securities, equity
securities issued by unconsolidated
subsidiaries and affiliates, or othersecurities had declined significantly
and such impairment of the value
is not deemed temporary, thosesecurities are written down to thefair value and the resulting losses areincluded in net profit or loss for theperiod.

(7) Foreign Currency Translation
Foreign currency transactions aretranslated using foreign exchange rates
prevailing at the respective transaction
dates. Receivables and payables inforeign currencies are translated at
the foreign exchange rates prevailingat the respective balance sheet dates
and the resulting transaction gains orlosses are included in net profit or loss
for the period.

(8) Translation of Foreign
Currency Financial
Statements (Accounts ofOverseas Subsidiaries)
Foreign currency denominatedstatements of overseas consolidated
subsidiaries have been translated
into Japanese yen using the method
prescribed by the Business Accounting
Deliberation Council of Japan. All
the balance sheet accounts of foreignsubsidiaries and affiliates are translated
at the foreign exchange rates prevailingat the respective balance sheet dates
except for common stock and capitalsurplus. On the other hand, all the
profit and loss accounts are translated
at the average foreign exchange rates
for the respective periods. Differences
arising from translation are presented
as “Foreign currency translation
adjustments” and “Non-controllinginterests in consolidated subsidiaries”
in the accompanying consolidated
financial statements.

(9) Income Taxes
The Company recognizes the tax effectof temporary differences between the
carrying amounts and the tax basis ofassets and liabilities. The provision
for income taxes is computed basedon the pretax income included in the
consolidated statement of income.
The asset and liability approach isused to recognize deferred tax assets
and liabilities for the expected future
tax consequences of temporary
differences.

for estimated unrecoverable amounts
individually.

(11) Retirement Benefits
The Company and some of its
subsidiaries recognize accrued pension
and severance costs to employees
based on the actuarial valuation ofprojected benefit obligation and plan
assets at their value. The retirement
benefit obligation for employees
is attributed to each period by thebenefit formula method. Prior service
costs are amortized based on thestraight-line method over a period often years. Actuarial gains and losses
are amortized based on the straightline method over a period of ten years
starting from the beginning of thesubsequent year.

(12) A ccrued Employees’
Bonuses
Accrued employees’ bonuses at thebalance sheet date are based on an
estimate of the amounts to be paidas bonuses for services rendered by
employees by that date.

(13) Accrued Directors’ Bonuses
Accrued directors’ bonuses at thebalance sheet date are based on an
estimate of the amounts to be paidas bonuses for servises rendered bydirectors by that date.

(14) R esearch and Development
Expenses
Research and development expenses
are charged to income as incurred.

(10) Allowance for Doubtful
Accounts(15) N et Income and Dividends
per Share

In general, the Company and its
subsidiaries provide the allowancebased on the past receivables loss
experience for a certain reference
period. Furthermore, for receivablesfrom companies with financial
difficulty, which could affect the
debtors’ ability to perform their
obligations, the allowance is provided

Basic net income per share iscomputed based on the net income
and the weighted average number ofshares of common stock outstanding
during each period. Diluted net
income per share is computed basedon the net income available for
distribution to the shareholders andthe weighted-average numbers of24

shares of common stock outstanding
during each year after giving effectto the dilutive potential of shares ofcommon stock to be issued upon theexercise of stock subscription rights
and stock options. Cash dividends per
share shown for each fiscal period
in the accompanying consolidated
statement of income represent actual
dividends declared as applicable to acommon stock during the respective
fiscal period.

(16) Revenue from Construction
Contracts
Revenues and costs of construction
contracts are recognized by thepercentage-ofcompletion method incase the percentage of completionfor each contract can be reliably
e s t i m a t e d . T h e p e rc e n t a g e o fcompletion is measured by thepercentage of total costs incurred todate to estimated total costs for eachcontract. The completed-contract
method is applied to the contracts incase the percentage of completioncannot be reliably estimated.

(17) Accounting for Consumption
Taxes
Transactions subject to consumption
taxes are recorded at amounts
exclusive of consumption taxes.

(18) Accounting Changes(a) Adoption of “Practical Solution ona change in depreciation method
due to Tax Reform 2016”
The Company and its domestic
consolidated subsidiaries adopted“Practical Solution on a change indepreciation method due to Tax
Reform 2016” (ASBJ Practical Issue
Task Force No.32, June 17, 2016) asa result of revisions to the Corporate
Tax Act of Japan. Accordingly, thedepreciation method for both facilities
attached to buildings and structuresacquired on or after April 1, 2016 waschanged from the declining-balancemethod to the straight-line method.

The above-mentioned changes
to accounting policies had only anegligible effect on the consolidated
financial statements of the Company
for the fiscal year ended March 31,2017.
(b) Accounting change in recognizing
expenses for Parking Lot
Management Business
Effective from the fiscal year ended
March 31, 2017, certain consolidated
subsidiaries engaged in the parking lot
management business have changed
their accounting method for a certain
portion of their expenses for theparking lot management business. The
current method is to recognize andmeasure related expenses as a direct
cost managed by the parking businesslocation and such costs are includedin the cost of sales. Such expenses
were previously recognized andmeasured as overhead management
expenses and therefore included inselling, general and administrative
expenses. In order to strengthen
profitability management for eachparking business location, certain
consolidated subsidiaries engaged in
the parking lot management businessperformed an overall review of its
operations and re-examined thefunctions and roles of each site. As aresult, it was determined that it would
serve as more useful disclosure toaccurately correspond the expenses
for parking lot management businessoccurred with net sales. Consequently,
the aforementioned change was
implemented after completing thechange to the system. Since thischange in accounting policy wasapplied retroactively, the financial
statements for the year ending March
31, 2016 have been reclassified after
the retroactive application. As a resultof the above, cost of sales for the year
ending March 31, 2016 increased by¥1,545 million, and both gross profit
and selling, general and administrative
expenses decreased by the same25

amount, compared to the figures
before the retroactive application.
However, there was no impact on
operating profit, ordinary profit orincome before income taxes for thisfiscal year.

(19) Additional Information(a) Adoption of Implementation
Guidance on Recoverability ofDeferred Tax Assets“Revised Implementation Guidance on
Recoverability of Deferred Tax Assets“ (ASBJ Guidance No.26 of March 28,2016) has been adopted from the fiscal
year ended March 31, 2017.

4. United States Dollar Amounts
The Company maintains its
accounting records in Japanese yen.
The U.S. dollar amounts included in
the consolidated financial statements
and notes thereto represent thearithmetical results of translating
Japanese yen to U.S. dollars at a rateof ¥ 112 = US$1, the approximate
effective rate of exchange prevailingon March 31, 2017. The inclusionof U.S. dollar amounts is solely forconvenience of readers outside Japanand is not intended to imply that yen
amounts could be converted, realized,
or settled in U.S. dollars at that, or any
other rate.

5. Investments in Unconsolidated Subsidiaries and Affiliates
Among investments in securities, the amount in aggregate corresponding to unconsolidated subsidiaries and affiliates at
March 31, 2017 and 2016 is as follows:
Millions of Yen

Investments in equity securities
Others2017¥1,65653

Thousands of U.S.dollars ( Note 4 )2016¥1,633138

2017$14,786473

6. Assets Pledged as Collateral and Obligations Secured by Collateral
As at March 31, 2017 and 2016, the following assets were pledged as collateral:
Millions of Yen

Cash and bank deposits
Buildings and structures
Long-term bank deposits

2017
¥65
–
–

Thousands of U.S.dollars ( Note 4 )

2016
¥61
32
2

2017
$580
–
–

As at March 31, 2017 and 2016, such collateral secured the following obligations:
Millions of Yen

Short-term bank loans

2017–

Thousands of U.S.dollars ( Note 4 )

2016
¥5

2017
–

7. Selling, General and Administrative Expenses
Selling, general and administrative expenses during the years ended March 31, 2017 and 2016 principally include:
Millions of Yen

Employees' bonuses
Directors' bonuses
Retirement benefits
Salaries and allowances
Allowance for doubtful accounts

2017¥1,51468
1,133
16,8421292016¥1,53865
1,275
16,98471

Thousands of U.S.dollars ( Note 4 )2017$13,518607
10,116150,375
1,152

8. Research and Development Costs
Research and development costs included in selling, general and administrative expenses and manufacturing cost for the years
ended March 31, 2017 and 2016 are as follows:
Millions of Yen

Research and development costs

2017¥1,3312016¥1,374

26

Thousands of U.S.dollars ( Note 4 )2017$11,884

9. Changes in Shareholders’ Equity
Changes in “Shares issued and outstanding” and “Shares of treasury stock” during the period from April 1, 2016 to March 31,2017 are as follows:(1) Shares issued and outstanding
Share type
Common stock (shares)

As of April 1, 2015
76,657,829

Increase

Decrease–

As of March 31, 201776,657,829–(2) Shares of treasury stock
Share type
As of April 1, 2016
Increase
Decrease
As of March 31, 2017
Common stock (shares)
68,109539,542–
607,651(Reason of change)
The increase in the number of shares is due to the purchases of 1,642 shares less than one unit and purchases of 537,900 shares by a resolution of the Board of
Directors meeting held on October 28, 2016.
Changes in “Shares issued and outstanding” and “Shares of treasury stock” during the period from April 1, 2015 to March 31, 2016 are as follows:(1) Shares issued and outstanding
Share type
As of April 1, 2015
Increase
Decrease
As of March 31, 2016
Common stock (shares)
76,657,829––
76,657,829(2) Shares of treasury stock
Share type
As of April 1, 2014
Increase
Common stock (shares)
66,585
1,524(Reason of change)
The increase in the number of shares is due to the purchases of shares less than one unit.

Decrease

As of March 31, 2015
68,109–

10. Dividends
Information on dividends for the fiscal year ended March 31, 2017 is as follows:(1) Dividends paid
Resolution

Share type

Ordinary general meeting of shareholders, Common stock
June 29, 2016
Board of directors meeting,Common stock
October 28, 2016

Total dividend Total dividend Dividend per share Dividend per share Date of record(Millions of Yen) (Thousands of U.S.dollars)(Yen)(U.S.dollars)

Effective date

¥2,144$19,148¥28$0.250March 31, 2016 June 30, 2016

¥1,761$15,727¥23$0.205“September 30,
2016”

December 2,
2016(2) Dividends for which the date of record falls in the fiscal year, but the effective date is after the end of the fiscal year.
Date of
Dividend Total dividend Total dividend Dividend per share Dividend per share
Resolution
Share type
Effective datefunding(Yen)(U.S.dollars)(Millions of Yen) (Thousands of U.S.dollars)recordOrdinary general meeting of shareholders,CommonRetained¥2,205$19,688¥29$0.259March 31, 2017 June 30, 2017
June 29, 2017stock
earnings
Information on dividends for the fiscal year ended March 31, 2016 is as follows:(1) Dividends paid
Total dividend
Resolution
Share type(Millions of Yen)
Ordinary general meeting of shareholders,Common stock¥1,761
June 26, 2015
Board of directors meeting,Common stock¥1,531
October 29, 2015

Dividend per share(Yen)

Date of record¥23

March 31, 2015

June 29, 2015¥20

September 30, 2015

December 2, 2015

(2) Dividends for which the date of record falls in the fiscal year, but the effective date is after the end of the fiscal year.
Total dividend Dividend per share
Dividend
Resolution
Share type
Date of record
funding(Yen)(Millions of Yen)
Ordinary general meeting of shareholders, Common stock Retained earnings¥2,144¥28
March 31, 2016
June 29, 201627

Effective date

Effective dateJune 30, 2016

11. Cash and Cash Equivalents
Reconciliations of cash and cash equivalents to the amounts shown in the consolidated balance sheet as at March 31, 2017 and 2016 are as follows:
Thousands of U.S.dollars( Note 4 )2017$347,687
12,814
360,501(36,215)(9,375)$314,912

Millions of Yen
Cash and bank deposits
Marketable securities
Sub total
Time deposits due over three months
Marketable securities due over three months
Cash and cash equivalents

2017¥38,940
1,435
40,376(4,056)(1,050)¥35,270

2016¥36,888
1,527
38,416(4,589)(1,100)¥32,725

Thousands of U.S.dollars( Note 4 )2017$7,26812,196

Millions of Yen
2017
¥814
1,366

Leased assets
Lease obligations

2016¥1,3771,278

12. Impairment Loss on Fixed Assets
Impairment loss on fixed assets for the years ended March 31, 2017 and 2016 is summarized as follows:
Millions of Yen

Location

Purpose of use

Category

Amano USA Holdings, Inc.
(U.S.A.)

Head office

Buildings and structures

2017

2016

–

¥236

Thousands of U.S.dollars( Note 4 )2017–

Method to Group Assets:
The Company and its subsidiaries group assets according to minimum units that generate cash flows essentially independent from the cash flows of other assets or groups of assets.
Recognition of Impairment Losses:
In the year ended March 31, 2016, the remarkable change of using method occured in Amano USA Holdings, Inc. As a result, the book values of these assets were reduced to the recoverable amounts, and the reductions were recognized as impairment losses based on US-GAAP.
Calculation of Recoverable Amount:In the year ended March 31, 2016, the recoverable amount for the buildings and structures of Amano USA Holdings, Inc. is a net sale value based on a realestate judgment valuation.

28

13. Other Comprehensive Income
The following table presents reclassification adjustments and tax effects allocated to each component of other comprehensive
income (loss) for the years ended March 31, 2017 and 2016:

2017
¥692
(100)
592
(107)
484

2016
(¥68)
–
(68)
(14)
(82)

Thousands of U.S.dollars( Note 4 )2017$6,179
(893)
5,286
(955)
4,326

(1,219)–(1,219)–(1,219)(1,267)–(1,267)–(1,267)(10,891)–(10,891)–(10,891)

(8)
285
276
(84)
192

(652)
167
(485)
129
(356)

(71)
2,545
2,464
(750)
1,715

1
(8)

(10)
(7)

9
(71)

(6)
(¥549)(17)(¥1,723)(57)($4,907)

Millions of Yen
Net unrealized gains (losses) on other securities:
Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Amount before tax effect ………………………………………………………
Tax effect …………………………………………………………………………
Net unrealized gains (losses) on other securities ……………………………
Translation adjustments:
Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Amount before tax effect ………………………………………………………
Tax effect …………………………………………………………………………
Translation adjustments ………………………………………………………
Retirement benefits liability adjustments:
Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Amount before tax effect ………………………………………………………
Tax effect …………………………………………………………………………
Retirement benefits liability adjustments ……………………………………
Share of other comprehensive income (loss) of companies accounted for by the equity method:Amount arising during the year ………………………………………………
Reclassification adjustments ……………………………………………………
Share of other comprehensive income of companies accounted
for by the equity method ………………………………………………………
Total other comprehensive income (loss) ……………………………………

14. Lease Commitments(1) Lessees’ accounting
Minimum future lease payments under operating leases subsequent to March 31, 2017 and 2016 for non-cancelable operating leases are summarized as follows:
Millions of Yen
Due within one year
Due over one year
Total

2017
¥810
1,365
¥2,176

2016
¥72
513
¥585

Thousands of U.S.dollars ( Note 4 )2017$7,232
12,188$19,429(2) Lessors’ accounting
Minimum future lease income under operating leases subsequent to March 31, 2017 and 2016 for non-cancelable operating leases is summarized as follows:
Millions of Yen
Due within one year
Due over one year
Total

2016
¥100
705
¥805

2015
¥99
805
¥905

29

Thousands of U.S.dollars ( Note 4 )
2016
$893
6,295
$7,188

15. Financial Instruments
Overview(1) Management policy
The management policy of the Company is to invest surplus funds into low-risk financial instruments. The Company has not held any high-risk financial instruments.

(2) Financial instruments and their risks
Both notes receivable and accounts receivable as operating receivables are exposed to credit-related losses in the event of nonperformance by counterparties. Trade notes, accounts payable and electronically recorded monetary claims as trade liabilities are due and payable within one year. Marketable securities and investments in securities are exposed to changes inmarket price. The Company holds marketable securities and investments in securities mainly as held-to-maturity or due to relationship-building with counterparties.

(3) Risk management policiesa) Management policy for credit risk (losses in the event of nonperformance by counterparties)
The Company has an established credit management policy, whereby credit risk exposure arising from both notes and accounts receivable is monitored on an ongoing basis in order todetect credit deterioration as well as to trigger appropriate minimizing measures at its early stages.
Held-to-maturity investments are subject to the examination and decision of the Funds Management Review Committee and accordingly, investments largely consist of negotiable
deposits and high graded securities, which are considered to have minimal credit risk.

b) Management policy for market risk (foreign currency exchange and interest rates)
Marketable securities and investment securities are marked to market and the financial condition of the issuer (client company) is monitored periodically.
In addition, the holdings of bonds and securities, other than held-to-maturity investments, are reviewed on an ongoing basis, taking into consideration the relationship, and other factors, with the issuer.

c) Management policy for liquidity risk (in default on its financial obligations)
The Company has managed liquidity risk by holding appropriate funds based on the forecasts, and actual cash flow is continuously monitored by the management.

(4) Supplementary explanation on the fair value of financial instruments
The fair values of financial instruments are based on quoted market prices. If quoted market prices are unavailable, the fair values are estimated based on the prices which are assessed asreasonable by the Company. Since the Company takes contingent variable factors into account when estimating the fair value, it would vary depending on the different preconditions.

Estimated fair value of financial instruments
Differences between carrying value and estimated fair value as of March 31, 2017 and 2016 are as follows:
Financial instruments whose fair values are difficult to estimate are not stated in the following table; refer to (* 2).

(1) Cash and bank deposits(2) Notes and accounts receivable(3) Marketable securities and investments in securities① Held-to-maturity② Subsidiaries and affiliates③ Other securities
Total (Assets)(4) Trade notes and accounts payable(5) Electronically recorded monetary claims
Total (Liabilities)(1) Cash and bank deposits(2) Notes and accounts receivable(3) Marketable securities and investments in securities① Held-to-maturity② Subsidiaries and affiliates③ Other securities
Total (Assets)(4) Trade notes and accounts payable(5) Electronically recorded monetary claims
Total (Liabilities)

Carrying
value¥38,940
33,710
1,150
1,607
6,439
¥81,849¥7,6296,580¥14,209

Carrying
value¥36,888
34,576
1,350
1,582
6,026
¥80,423¥7,642
6,438¥14,080

Millions of Yen
2017
Estimated
Difference
fair value
in amounts¥38,940–
33,710
–
1,147
1,134
6,439
¥81,374¥7,6296,580¥14,209

(¥2)
(472)
–
(¥474)–––

Millions of Yen
2016
Estimated
Difference
fair value
in amounts¥36,888–
34,576
–
1,348
1,005
6,026
¥79,844¥7,642
6,438¥14,080

30

(¥1)
(577)
–
(¥578)–––

Thousands of U.S.dollars ( Note 4 )2017
Carrying
Estimated
Difference
value
fair value
in amounts$347,687$347,687–
300,991
300,991–
10,26814,34857,491$730,795$68,11758,757$126,866

10,241
10,12557,491$726,554$68,11758,757$126,866($18)(4,214)–($4,232)–––

(NOTES)(* 1): Methods to determine the estimated fair value of financial instruments and other matters related to securities and derivative transactions.
Assets:(1) Cash and bank deposits, and (2) Notes and accounts receivable:
Since these items are settled in a short period of time, their carrying value approximates fair value.
(3) Marketable securities and investments in securities:
Since negotiable certificate of deposits are settled in a short period of time, their carrying values approximate fair value.
The fair value of the other stocks is based on quoted market prices. The fair value of debt securities is based on either quoted market prices or prices provided by the financial institutions making markets in these securities. For information on securities classified by holding purpose, please refer to (*5) Heldto-maturity and other securities with readily determinable fair value as at March 31, 2017 and 2016.
Liabilities:(4) Trade notes and accounts payable, and (5) Electronically recorded monetary claims:
Since these items are settled in a short period of time, their carrying value approximates fair value.

(*2): Financial instruments whose fair values are difficult to estimate are as follows:
Millions of Yen
Unlisted securities (Carrying value)

2017
¥271

2016
¥428

Thousands of U.S.dollars ( Note 4 )2017$2,420The unlisted securities as stated above are not included in (3) Marketable securities and investments in securities because it is difficult to estimate the fair value
based on the quoted market prices in active markets.

(*3) Redemption schedule for monetary claims and securities with maturities subsequent to the balance sheet date is as follows:

Cash and bank deposits
Notes and accounts receivable
Marketable securities and investments in securities:
Held-to-maturity securities
Total

Cash and bank deposits
Notes and accounts receivable
Marketable securities and investments in securities:
Held-to-maturity securities
Other securities with maturities
Total

Cash and bank deposits
Notes and accounts receivable
Marketable securities and investments in securities:
Held-to-maturity securities
Total

Due
within 1 year
¥38,940
33,7101,050¥73,701

Millions of Yen
2017
Due after 1 year
Due after 5 years
but within 5 years
but within 10 years
–
–
–
–
–
–

Due
within 1 year
¥36,888
34,576
1,000
100¥72,564

Millions of Yen
2016
Due after 1 year
Due after 5 years
but within 5 years
but within 10 years
–
–
–
–
¥250
–
¥250

Due
within 1 year
$347,687
300,991
9,375$658,045

¥100
–
¥100

Thousands of U.S.dollars ( Note 4 )2017
Due after 1 year
Due after 5 years
but within 5 years
but within 10 years
–
–
–
–
–
–

31

¥100
¥100

$893
$893

Due
after 10 years
–
–
–
–

Due
after 10 years
–
–
–
–
–

Due
after 10 years––––

(*4) Repayment schedule for bonds payable, long-term loans payable, lease obligations and other interest-bearing liabilities
subsequent to the balance sheet date:Long-term loans payable
Lease obligations
Total

Due within 1 year The second year–¥469
¥1,391
1,125¥1,391¥1,594

Millions of Yen
2017
The third year The fourth year
–
–
¥766
¥568
¥766
¥568

The fifth year
–
¥301
¥301

Thereafter
–
¥192
¥192

Millions of Yen

2016
Long-term loans payable
Lease obligations
Total

Due within 1 year The second year–¥37
¥1,4481,185¥1,448¥1,222The third year
¥469
917
¥1,387

The fourth year
–
¥554
¥554

The fifth year
–
¥359
¥359

Thereafter
–
¥239
¥239

Long-term loans payable
Lease obligations
Total

Thousands of U.S.dollars ( Note 4 )2017
Due within 1 year The second year The third year The fourth year
The fifth year–
$4,189–––$12,423
10,051$6,843$5,080$2,689$12,423$14,240$6,843$5,080$2,689Thereafter–$1,718$1,718(*5) Held-to-maturity and other securities with readily determinable fair value as at March 31, 2017 and 2016 are as follows:
Millions of Yen
2017

Held-to-maturity

Other securities with carrying
value exceeding acquisition cost
StocksOther
		Subtotal
Other securities with carrying
value not exceeding acquisition cost
StocksOther
		Subtotal
		TotalHeld-to-maturity

Other securities with carrying
value exceeding acquisition cost
StocksOther
		Subtotal
Other securities with carrying
value not exceeding acquisition cost
StocksOther
		Subtotal
		TotalThousands of U.S.dollars ( Note 4 )2017
Unrealized
Carrying value
Fair value
gains (losses)$10,268$10,241($18)

Carrying value

Fair value¥1,150¥1,147

Unrealized
gains (losses)(¥2)

Carrying value

Acquisition
cost

Unrealized
gains (losses)

Carrying value

Acquisition
cost

Unrealized
gains (losses)¥5,537382
5,919¥2,843377
3,221¥2,693
4
2,698$49,438
3,411
52,848$25,384
3,366
28,759$24,045
36
24,089517
2519¥6,439597
2599¥3,820(80)–(80)¥2,618

4,616
18
4,634
$57,491

5,330
18
5,348
$34,107

(714)
–
(714)
$23,375

Carrying
value¥1,350Millions of Yen
2016
Fair
value
¥1,348

Unrealized
gains (losses)(¥1)

Carrying
value

Acquisition
cost

Unrealized
gains (losses)¥4,617525
5,143¥2,550519
3,070¥2,067
5
2,072

881
2
883
¥6,026927
2930¥4,000(46)–(46)¥2,026(*6) Other securities sold for the year ended March 31, 2017 is as follows:

Stocks		TotalMillions of Yen
2017
Total amount of Total amount ofSales amountloss on salegain on sale
¥400
¥100
–
¥400
¥100
–

32

Thousands of U.S.dollars ( Note 4 )2017
Total amount of Total amount ofSales amountloss on salegain on sale
$3,576$896–$3,576$896–

16. Retirement Benefits
Outline of the retirement benefit plans adopted(1) Defined benefit corporate pension scheme: From March 1, 2009, the Company adopted a defined benefit corporate pension scheme as part of its retirement benefit plan.
(2) Defined contribution pension scheme: From March 1, 2009, the Company adopted a defined contribution pension scheme as part of its retirement benefit plan.
(3) Employees’ pension fund: Since April 1, 1980, the Company has used an multi-employer contributory funded pension plan as a supplement to its existing
retirement benefit scheme.
The Kanagawa Prefecture Iron and Steel Welfare Pension Fund was dissolved on March 31, 2007 after approval of the Minister of Health, Labor and Welfare.
No addional contribution due to the dissolution of this fund is expected.
In addition, certain subsidiaries have lump-sum payment plans and a defined benefit corporate pension plan. They calculate the retirement benefit expenses, andassets and liabilities for retirement benefits by means of a simplified method.
Multi-employer scheme
The required contributions for the employees’ pension fund system, which is a multi-employer pension scheme that is accounted for in the same manner as adefined contribution plan, were ¥ 286 million and ¥ 490 million in the years ended March 31, 2017 and 2016, respectively.
(1) Most recent funded status of the multi-employer plan

As of March
31, 2016¥57,799

As of March
31, 2015¥63,738

Thousands of U.S.dollars( Note 4 )As of March
31, 2016$516,063

60,538(¥2,738)

75,343(¥11,605)

540,518($24,446)

Millions of Yen

Amount of pension assets
Total of amount of pension obligations based onamount of pension financing calculations in thescheme and minimum reserve amount
Net amount(2) Amount paid by the Company as a percentage of contributions to the multi-employer plan
For the year ended March 31, 2015:
For the year ended March 31, 2016:

23.0%
22.9%

(3) Supplemental information
The net amount in (1) above was mainly due to a prior service obligation in pension financing (As of March 31, 2015: ¥ 8,925 million; As of
March 31, 2016: ¥ 8,554 million). The method of amortizing the prior service obligation in this plan is to evenly amortize the principal and interest over a period of 20 years, and special contributions of ¥ 187 million and ¥ 187 million were expensed in the Company’s consolidated financial
statements in the years ended March 31, 2017 and 2016, respectively. The percentage of the Company’s contribution in (2) above does not match
the percentage of its actual pension obligation.
The changes in the retirement benefit obligation for the years ended March 31, 2017 and 2016 are as follows:
Millions of Yen
Balance at the beginning of the year
Service cost
Interest cost
Actuarial loss
Retirement benefits paid
Prior service cost
Other
Balance at the end of the year2017
¥11,996
853
50
(99)
(754)
–
(38)
¥12,0082016¥10,999
814
80
725
(588)
–
(35)
¥11,996

Thousands of U.S.dollars( Note 4 )2017$107,107
7,616
446
(884)
(6,732)–(339)$107,214

The changes in plan assets for the years ended March 31, 2017 and 2016 are as follows:
Millions of Yen
Balance at the beginning of the year
Expected return on plan assets
Actuarial loss
Contributions by the Company
Retirement benefits paid
Other
Balance at the end of the year2017
¥9,181
229
(84)
1,016
(615)
5
¥9,73333

2016¥8,675
216
19
771
(500)
(0)
¥9,181Thousands of U.S.dollars( Note 4 )2017$81,973
2,045
(750)
9,071
(5,491)
45$86,902

The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as of March 31, 2017and 2016 for the Company’s and the consolidated subsidiaries’ defined benefits plans:
Thousands of U.S.dollars
Millions of Yen( Note 4 )
2017
2016
2017
Funded retirement benefit obligation¥11,892¥11,873$106,179(9,733)(9,181)(86,902)
Plan assets at fair value
2,159
2,692
19,277
116
123
1,036
Unfunded retirement benefit obligation
Net liability for retirement benefits in the balance sheet
2,275
2,815
20,313Liability for retirement benefits
Asset for retirement benefits
Net liability for retirement benefits in the balance sheet

2,275–¥2,275

20,313–$20,3132,815–¥2,815The components of retirement benefit expense for the years ended March 31, 2017 and 2016 are as follows:
Millions of Yen
2017
¥853
50
(229)
264
(3)
¥935

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost
Retirement benefit expense

2016
¥814
80
(216)
224
(3)
¥899

Thousands of U.S.dollars( Note 4 )2017$7,616446(2,045)2,357(27)$8,348The components of retirement benefits liability adjustments included in other comprehensive income (before tax effect) for the years ended March
31, 2017 and 2016 are as follows:
Thousands of U.S.dollars
Millions of Yen( Note 4 )
2017
2016
2017
Prior service cost
(¥3)
(¥3)
($27)
280
(481)
2,500
Actuarial gain
Total
¥276
(¥485)$2,464The components of retirement benefits liability adjustments included in accumulated other comprehensive income (before tax effect) as of March
31, 2017 and 2016 are as follows:
Thousands of U.S.dollars
Millions of Yen( Note 4 )
2017
2016
2017
Unrecognized prior service cost
¥6
¥10
$54
(1,428)(1,708)(12,750)
Unrecognized actuarial loss
Total(¥1,421)(¥1,697)($12,688)
The fair value of plan assets, by major category, as a percentage of total plan assets as of March 31, 2017 and 2016 is as follows:
Millions of Yen
2017
2016
9%
10%
60%
76%
12%
12%
19%
2%
100%
100%

General accounts
Bonds
StocksOther
Total

The expected return on plan assets has been estimated based on the anticipated allocation to each asset class and the expected long-term returns
on assets held in each category.
The assumptions used in accounting for the above plans were as follows:**They are calculated by the weighted average method.
2017
0.7%
2.5%
5.1%

Discount rate
Expected long-term rate of return on plan assets
Expected rates of salary increases

34

2016
0.6%
2.5%
5.1%

For defined benefit plans to which the simplified method is applied, the changes in the retirement benefit obligation for the years ended March 31,2017 and 2016 are as follows:
Millions of Yen
2017
¥89
35
(18)
(23)
(0)
¥82

Balance at the beginning of the year
Retirement benefit expense
Retirement benefits paid
Contributions to plans
Other
Balance at the end of the year

2016
¥109
43
(38)
(25)
(0)
¥89

Thousands of U.S.dollars( Note 4 )
2017
$795
313
(161)
(205)
(0)
$732

The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as of March 31, 2017and 2016 for the Company’s and the consolidated subsidiaries’ defined benefits plans:

Unfunded retirement benefit obligation
Net liability for retirement benefits in the balance sheet

2017
¥202
(241)
(38)
121
82

2016
¥176
(210)
(34)
123
89

Thousands of U.S.dollars( Note 4 )2017$1,804(2,152)
(339)
1,080
732

Liability for retirement benefits
Asset for retirement benefits
Net liability for retirement benefits in the balance sheet

170
(88)
¥82

170
(81)
¥89

1,518
(786)
$732

Millions of Yen
Funded retirement benefit obligation
Plan assets at fair value

Retirement benefit expenses calculated using the simplified method for the years ended March 31, 2017 and 2016 are as follows:
Millions of Yen
2017
¥35

Retirement benefit expenses

2016
¥43

Thousands of U.S.dollars( Note 4 )
2017
$313

Contributions to defined contribution plans of the Company and its consolidated subsidiaries for the years ended March 31, 2017 and 2016 are as follows:
Millions of Yen
2017
¥397

Contributions to defined contribution plans

35

2016
¥379

Thousands of U.S.dollars( Note 4 )2017$3,545

17. Income Taxes
Deferred tax assets and liabilities (both current and non-current) as at March 31, 2017 and 2016 consisted of the following elements:
Millions of Yen

Thousands of U.S.dollars(Note 4)

2017

2016

2017

Deferred tax assets:
Accrued enterprise tax
Accrued employees' bonuses
Accounts payable and long-term accounts payable
Net liability for retirement benefits
Loss carried forward
Loss on write-down of investments in securities
Surplus on allowance for doubtful accounts
Unrealized gains
OthersLess: valuation allowance
Total deferred tax assets

¥155
747
45
736
1,168
304
154
629
1,423
(1,455)¥3,911

¥184
828
52
879
1,073
296
125
650
1,479
(1,466)¥4,103$1,384
6,670
402
6,571
10,429
2,714
1,375
5,616
12,705(12,991)$34,920

Deferred tax liabilities:
Reserve for advanced depreciation of building
Acquired intangible assets
Unrealized loss on other securities
OthersTotal deferred tax liabilities
Net deferred tax assets

(11)
(3)
(681)
(59)
(756)
¥3,154

(11)
(11)
(573)
(85)
(682)
¥3,420(98)(27)(6,080)(527)(6,750)$28,161

Reconciliation of the effective statutory tax rate and the actual tax rate is shown below:
Effective statutory tax rate
Adjustments:
Entertainment and other nondeductible expenses
Dividends and other nontaxable income
Inhabitant tax on per capita levy
Nondeductible amortization of goodwill
Eliminated dividend received from subsidiaries
Realization of tax benefits on operating losses
Tax credit for research and development expenses
Valuation allowance
Deferred tax assets reduced by change of taxation rates
Difference of foreign subsidiaries' taxation rates
Equity in earnings of affiliates
OthersActual tax rate

36

2017
30.8%

2016
33.0%

0.6
(2.0)
0.6
1.2
2.3
(0.4)
(0.4)
(0.2)
–
(0.0)
(0.1)
0.3
32.7%

0.6
(1.4)
0.6
2.2
2.1
(1.7)
(0.4)
(0.1)
0.5
(0.2)
(0.4)
1.2
36.0%

18. Segment Information
The reportable segments of the Company are components for which discrete financial information is available and whose operating results are regularly reviewed by the Executive Committee to make decisions about resource allocation and to assess performance.
The reportable segments are as follows:
1. Time information system business
2. Environment system business(1) Sales, profits or losses, assets and other items by reportable segments
Millions of Yen
2017
Reportable segments
Time information Environment
Total
system business system businessNet sales:
Sales to third parties
Intersegment sales and transfers
		TotalSegment profit or loss
Segment assets
Depreciation and amortization
Investment in equity-method affiliates
Increase in tangible and intangible fixed assets¥87,010–87,01011,89062,616
3,865
1,607
4,438

¥33,113–
33,113
4,893
27,275513–
481¥120,124–
120,124
16,78489,892
4,379
1,607
4,919

Adjustments/
Eliminations

Consolidated–––(¥3,618)
47,996554–
668¥120,124–
120,124
13,165
137,888
4,933
1,607
5,587

Adjustments/
Eliminations

Consolidated–––(¥3,732)
45,159
552
236
–
827

¥119,506–
119,506
12,942
136,965
4,415
236
1,582
6,646

Millions of Yen
2016
Reportable segments
Time information
Environment
system business system businessNet sales:
Sales to third parties
Intersegment sales and transfers
		TotalSegment profit or loss
Segment assets
Depreciation and amortization
Impairment loss for fixed assets
Investment in equity-method affiliates
Increase in tangible and intangible fixed assets¥85,462–
85,462
12,09963,963
3,345
–
1,582
5,396

¥34,044–
34,044
4,576
27,843
517
–
–
422

Total
¥119,506–
119,506
16,67591,806
3,862
–
1,582
5,819

Thousands of U.S. dollars (Note 4)
2017
Reportable segments
Adjustments/
Time information Environment
Eliminations
Total
system business system businessNet sales:
Sales to third parties
Intersegment sales and transfers
		TotalSegment profit or loss
Segment assets
Depreciation and amortization
Investment in equity-method affiliates
Increase in tangible and intangible fixed assets$776,880–
776,880
106,163
559,080
34,517
14,354
39,626$295,658–
295,658
43,695
243,528
4,589
–
4,295

37

$1,072,538–
1,072,538
149,858
802,608
39,105
14,35443,920–––($32,311)
428,542
4,948
–
5,971

Consolidated$1,072,538–
1,072,538
117,547
1,231,150
44,053
14,35449,891

(2) Related Information
Geographic Segments

Information by geographic region for the years ended March 31, 2017 and 2016 is summarized as follows:
Millions of Yen

Net sales:
Japan
North America
OthersTotal

2017¥82,035
17,141
20,947¥120,124

2016¥78,832
18,996
21,677¥119,506

Millions of Yen

Tangible fixed assets:
Japan
OthersTotal

2017¥21,036
2,653¥23,689

Thousands of U.S.dollars(Note 4)

2017$732,457
153,049
187,030$1,072,538
Thousands of U.S.dollars(Note 4)2017
$187,822
23,689$211,512

2016¥20,988
2,601¥23,589(3) Information on both “amortization of goodwill” and “unamortized balance” by reportable segments as at and for theyears ended March 31, 2017 and 2016 is summarized as follows:

Amortization of goodwill
Unamortized balance

Millions of Yen
2017
Reportable segments
Time information Environment
Total
system business system business
¥624
59
¥684
¥2,895269¥3,165

Eliminations/
Corporate
–
–

Total
¥684
¥3,165

Millions of Yen
2016

Amortization of goodwill
Unamortized balance

Reportable segments
Time information
Environment
system business system business¥721
68¥3,744344

Amortization of goodwill
Unamortized balance

Thousands of U.S.dollars (Note 4)
2017
Reportable segments
Eliminations/Time information Environment
Corporate
Total
system business system business$5,577531$6,108––$25,853
2,405$28,259

38

Total
¥789
¥4,088Eliminations/
Corporate
–
–

Total
¥789
¥4,088

Total$6,108$28,25919. Per Share Data
Net assets and net income per share as at and for the years ended March 31, 2017 and 2016 are as follows:(1) Net assets per share
Yen

Net assets per share2017¥1,301.29

U.S.dollars (Note 4)

2016¥1,242.86

2017$11.619

The basis for these calculations is as follows:
Millions of Yen

2017¥99,421458(458)
98,963

Total net assets in consolidated balance sheet
Amount to be deducted from total net assets(Out of the above non-controlling interest portion)
Net assets relating to common stock2016¥95,606
416(416)
95,190Thousands of U.S.dollars(Note 4)

2017
$887,692
4,093(4,093)
883,599

SharesNumber of shares of common stock used tocompute net assets per share

76,050,178

76,589,720(2) Net income per share
Yen

2017
¥120.79

Net income per share

U.S.dollars (Note 4)2016¥109.752017$1.078Notes: Diluted net income per share is omitted as there were no potential shares with dilutive effect.
The basis for these calculations is as follows:
Millions of Yen

2017¥9,2239,223

Net income in the consolidated statement of income
Net income relating to common stock2016¥8,405
8,405
SharesAverage number of shares ofcommon stock outstanding during the year2017
76,364,626

39

2016
76,590,480

Thousands of U.S.dollars(Note 4)

2017$82,348
82,348

Corporate Data
Domestic Operations
HEAD OFFICESALES OFFICESDOMESTIC SUBSIDIARIES275 Mamedocho, Kohoku-ku, Yokohama,
Kanagawa, JAPAN 222-8558

72 Sales Offices Located in major cities,
including

AMANO MANAGEMENT SERVICE CORPORATIONAMANO MAINTENANCE ENGINEERING CORPORATIONAMANO BUSINESS SOLUTIONS CORPORATIONENVIRONMENTAL TECHNOLOGY CO., LTD.
AMANO MUSASHI ELECTRIC CORPORATIONAMANO AGENCY CORPORATIONFACILITIESSAPPORO Office, SENDAI Office
OMIYA Office, TOKYO Office
NAGANO Office, NIIGATA Office
YOKOHAMA Office, HAMAMATSU Office
NAGOYA Office, KANAZAWA Office
KYOTO Office, OSAKA Office
OKAYAMA Office, HIROSHIMA Office
TAKAMATSU Office, FUKUOKA Office

SAGAMIHARA Factory
HOSOE Factory

Board of Directors
Chairman & Representative Director(Outside) Directors

Managing Operating Officer

Izumi NAKAJIMA

Isao KISHI
Kiyoshi KAWASHIMA

Kenji KOHORI(Full-time) Audit & Supervisory Board Member

Tatsuo NIIHO
Masahiko MORITA
Myeong-Jin JEON
Tetsuhiro KONDO
Jun NAKAKURO
Yoshikazu TOAKE
Masahiro SAWADA
Sachio OTAKA
Takashi KASAI
Yoshihiko HATA

President & Representative Director

Hiroyuki TSUDA

Haruhiko YAMAGUCHI
Toru UENO

Director & Managing Operating Officer

Hiroshi SHIRAISHI
Isao TERASAKI(Outside) Audit & Supervisory Board Member

Yoshiyuki SATO
Takehide ITONAGA

Director & Operating Officer

Takeshi AKAGI
Yasuhiro SASAYA
Kunihiro IHARA
Manabu YAMAZAKI

Operating Officers

Overseas Operations
1. AMANO USA HOLDINGS,INC.
2. AMANO CINCINNATI,INC.
3. AMANO CINCINNATI,INC. OHIO FACTORY
4. AMANO McGANN CANADA INC.
5. AMANO PIONEER ECLIPSE CORPORATION
6. AMANO McGANN, INC.
7. ACCU-TIME SYSTEMS, INC.
8. AMANO TIME&ECOLOGY DE MEXICO S.A. DE C.V.

9
13,14

9. ACCU-TECH SYSTEMS, Ltd.
10. AMANO EUROPE HOLDINGS, N.V.
11. AMANO EUROPE, N.V.
12. AMANO TIME&PARKING SPAIN S.A.
13. HOROSMART, S.A.
14. HOROQUARTZ, S.A.
15. HOROQUARTZ MAROC, S.A.
16. AMANO KOREA CORPORATION

17.		AMANO INTERNATIONAL TRADING(SHANGHAI)CO.,LTD.
18.		AMANO SOFTWARE ENGINEERING (SHANGHAI)CO.,LTD.
19.		AMANO PARKING SERVICE LTD.
20.		AMANO MALAYSIA SDN.BHD.
21.		AMANO TIME&AIR SINGAPORE PTE.LTD.
22.		PT.AMANO INDONESIA
23.		AMANO THAI INTERNATIONAL CO.,LTD.

10,11
6

12
16

15

20

5

AMANO CORPORATION

17,18
19

8

23
21
22

40

4
3

1,2,7

275 Mamedocho, Kohoku-ku, Yokohama, Kanagawa, 222-8558 JAPAN
PHONE : +81 (45) 401-1441
FAX: +81 (45) 439-1150
HOME PAGE : http://www.amano.co.jp/English/