Ir Japan Holdings Ltd.TSE: 6035

Summary of Consolidated Financial Results for the Year Ended March 31, 2021 (J-GAAP)

May 24, 2021 at 7:02 AM UTC · Issued by IR Japan Holdings Ltd.

Listed Company Name: IR Japan Holdings, Ltd.		May10, 2021

Securities Code:	6035
Listing:	Tokyo Stock Exchange	URL:	https://www.irjapan.jp/
Representative:	Shirou Terashita, President and Chief Executive Officer
Contact:	Atsuko Furuta, General Manager, Corporate Planning Department Tel.: +81-3-3519-6750
Scheduled Annual General Meeting of Shareholders:	June 10, 2021
Scheduled Date to Start Dividend Payment:	June 11, 2021
Scheduled Date to Submit Securities Report:	June 18, 2021
Preparation of Results Briefing Materials:	Yes
Holding of Financial Results Briefing:	Yes (for institutional investors and analysts)

(Amounts of less than one million yen have been truncated)

1. Consolidated Financial Results (from April 1, 2020 to March 31, 2021)

Consolidated Operating Results

(Percentages indicate year-on-year changes)

Net sales

Operating profit

Ordinary profit

Profit attributable to

owners of parent

Year ended

Millions of yen

8,284

7.8

4,080

12.5

4,070

12.7

2,802

14.6

March 31, 2021

Year ended

7,682

59.1

3,626

152.8

3,611

149.5

2,445

150.3

March 31, 2020

Note: Comprehensive

income

Year ended

March 31, 2021: 2,804

million yen (14.7%)

Year ended March 31, 2020: 2,444 million yen (150.5%)

Profit per

Return on equity

Ordinary profit to

Operating profit

share-basic

share-diluted

total assets

to net sales

Year ended

Yen

157.81

―

47.3

50.5

49.3

March 31, 2021

Year ended

137.32

―

53.0

56.6

47.2

March 31, 2020

Reference: Equity in earnings (losses) of affiliates

Year ended March 31, 2021: - million yen

Year ended March 31, 2020: - million yen

(2)

Consolidated Financial Position

Total assets

Net assets

Equity ratio

Net assets per share

Millions of yen

Yen

As of March 31, 2021

8,410

6,647

79.0

374.22

As of March 31, 2020

7,712

5,212

67.6

293.52

Reference: Shareholders'

equity

As of March

31, 2021: 6,647 million

yen

As of March 31, 2020: 5,212 million yen

(3)

Consolidated Cash Flows

Net cash provided by

Cash and cash

(used in) operating

(used in) investing

(used in) financing

equivalents at the

activities

end of period

Year ended

Millions of yen

2,398

(366)

(1,419)

5,388

March 31, 2021

Year ended

3,512

(197)

(1,264)

4,777

March 31, 2020

2. Dividends

		Full-year dividend		Total	Dividend	Dividends to
						dividend
	First	Second	Third
			payout ratio	net assets
	quarter-	quarter-	quarter-	Year-end	Total	amount
	(Consolidated)	(Consolidated)
	end	end	end			(Annual)

	Yen	Yen	Yen	Yen	Yen	Millions of yen	%	%
Year ended	―	25.00	―	45.00	70.00	1,244	51.0	27.0
March 31, 2020

Year ended	―	35.00	―	50.00	85.00	1,509	53.9	25.5
March 31, 2021

Year ending
March 31, 2022	―	45.00	―	68.00	113.00		49.6
(Forecast)

3. Consolidated Results Forecast for the Fiscal Year Ending March 31, 2022 (from April 1, 2021 to March 31, 2022)

(Percentages indicate year-on-year changes)

	Net sales		Operating profit	Ordinary profit	Profit attributable	Profit per
		to owners of parent	share

	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Full year	12,000	44.8	6,000	47.0	5,990	47.1	4,050	44.5	228.00

Notes:

Changes in significant subsidiaries during the period
(changes in specified subsidiaries resulting in changes in the scope of consolidation): Yes
Newly included: one companyCompany name: Japan Originated Investment Bank
Change in accounting policies, accounting estimates, and retrospective restatements
1. Change in accounting policies in accordance with revision of accounting standards: None
2. Change in accounting policies other than item 1) above: None
3. Change in accounting estimates: None
4. Retrospective restatements: None
Number of shares issued (common stock)
1. Number of shares issued at the end of the period (including treasury shares)

	As of March 31, 2021	17,838,310 shares
	As of March 31, 2020	17,833,810 shares
2)	Number of treasury shares at the end of the period
	As of March 31, 2021	76,083 shares
	As of March 31, 2020	76,083 shares
3)	Average number of shares during the period
	Year ended March 31, 2021	17,760,957 shares
	Year ended March 31, 2020	17,808,653 shares

(Reference) Summary of Non-Consolidated Financial Results

1. Non-Consolidated Financial Results (from April 1, 2020 to March 31, 2021)

Non-ConsolidatedOperating Results

(Percentages indicate year-on-year changes)

	Net sales	Operating profit	Ordinary profit	Profit
	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%
Year ended March 31, 2021	2,717	65.5	2,508	73.5	2,492	74.3	2,318	72.3
Year ended March 31, 2020	1,642	31.6	1,445	36.5	1,430	35.6	1,346	36.5

	Profit per share-	Profit per share-
	basic		diluted
		Yen		Yen
Year ended March 31, 2021	130.56		-
Year ended March 31, 2020		75.59		-
			2

(2) Non-Consolidated Financial Position

	Total assets	Net assets		Equity ratio	Net assets per share
		Millions of yen	Millions of yen		%	Yen
As of March 31, 2021		4,831	4,315		89.3	242.93
As of March 31, 2020		4,842	3,365		69.5	189.52
Reference: Shareholders'	equity	As of March 31, 2021: 4,315 million yen
		As of March 31, 2020: 3,365 million yen

The auditing procedure by a certified public accountant or an auditing firm does not apply to these Financial Results.

Explanation regarding appropriate use of results forecast and additional notes

Forward-looking statements, including the results forecast, contained in this document are based on information available to the Company and on certain assumptions deemed to be reasonable as of the date of release of this document. Actual business results may differ substantially due to a number of factors. For conditions prerequisite to the results forecast, and the points to be noted in the use thereof, please refer to "1. Overview of Operating Results, etc. (4) Business Forecast for the Future" on page 9 of the attachment.

Contents of the Attachment
1. Overview of Operating Results, etc. ..............................................................................................................	5
(1)	Overview of Operating Results for the Fiscal Year Ended March 31, 2021..................................................	5
(2)	Overview of Financial Position for the Fiscal Year Ended March 31, 2021 .................................................	8
(3)	Overview of Cash Flows for the Fiscal Year Ended March 31, 2021............................................................	8
(4)	Business Forecast for the Future ...................................................................................................................	9
(5)	Basic Policy Concerning the Distribution of Profits and Dividend Distributions for the Fiscal Year Ended
	March 31, 2021 and the Following Fiscal Year.............................................................................................	9
2. Corporate Group ..........................................................................................................................................	10
3. Basic Approach to the Selection of Accounting Standards........................................................................	11
4. Consolidated Financial Statements and Primary Notes ............................................................................	12
(1)	Consolidated Balance Sheets.......................................................................................................................	12
(2)	Consolidated Statements of Income and Comprehensive Income...............................................................	14
(3)	Consolidated Statement of Changes in Equity ............................................................................................	16
(4)	Consolidated Statement of Cash Flows .......................................................................................................	18
(5)	Notes Relating to the Consolidated Financial Statements ...........................................................................	19
	Notes Relating to the Going Concern Assumption......................................................................................	19
	Significant Matters for the Basis of Preparation of the Consolidated Financial Statements .......................	19
	Consolidated Statement of Cash Flows .......................................................................................................	19
	Segment Information...................................................................................................................................	19
	Per Share Information .................................................................................................................................	19
5. Other ..............................................................................................................................................................	20
(1) Changes in Directors who are Audit and Supervisory Committee Members ................................................	20

Note: The Company held a briefing for investors (online meeting), as indicated below. Materials distributed at this briefing are set to be posted on the Company's website immediately after the briefing.

Financial results briefing for institutional investors and analysts: Monday, May 10, 2021

1. Overview of Operating Results, etc.

Overview of Operating Results for the Fiscal Year Ended March 31, 2021

General overview

								(Millions of yen)
				Fiscal 2020				Fiscal 2019
		(April 2020 to March 2021)		(April 2019 to March 2020)
		Amount		Change		Percentage		Amount	Percentage
				change (YoY)			change (YoY)

Net sales	8,284	602	7.8	7,682	59.1
Operating profit	4,080	454	12.5	3,626	152.8
Ordinary profit	4,070	459	12.7	3,611	149.5
Profit attributable to	2,802	357	14.6	2,445	150.3
owners of parent

(Reference) EBITDA	4,303	466	12.2	3,837	126.9

Note: EBITDA: Ordinary Profit + Interest Expenses + Depreciation

During the fiscal year ended March 31, 2021 (from April 1, 2020 to March 31, 2021), amicable and hostile activities by business companies and activists against listed companies in Japan gained momentum with respect to corporate restructuring and business reorganizations, including proposals made beneath the surface, marking the powerful start of an era of major restructuring in the Japanese economy. The Group maintained the same high level as the previous fiscal year, in terms of the number of equity consulting entrustments, and continued to increase sales and profits, as we deepened and expanded our business base through even more advanced solutions. However, due to the carrying forward of the completion of some large-scale projects that were planned for the second half of the fiscal year under review to the following year, as well as the impact of the lifting of ROE standards application by advisory companies on the exercise of voting rights in the run-up to the general meetings of shareholders due to the coronavirus outbreak, we were unable to achieve a significant increase in net sales, so that sales growth was not quite as dramatic as it could have been. On the other hand, profits continued to increase by double digits, absorbing the increase in labor costs and achieving an improved growth in profit margin on sales, compared to the previous fiscal year.

Against this background, in March of this year, an extraordinary general meetings of shareholders, which was requested by activists at one of Japan's leading listed companies, partially passed some activist proposals. The situation subsequently developed, with the proposed takeover of the company by the fund becoming public knowledge, and it is becoming clear that risks regarding ownership are not a remote concern for any listed company (or Board of Directors) any more. In addition, a revision of the Tokyo Stock Exchange (TSE) market categories based on the market capitalization of tradable shares at the end of June this year is forcing listed companies to decide whether to eliminate cross-shareholdings (non- tradable shares), and a revision of the Corporate Governance Code, a draft of which was published in April, has led to a rapid increase in the need by listed companies for equity consulting since the start of the new fiscal year.

The wholly-owned subsidiaries of the Group, IR Japan, Inc. (a Type I Financial Instruments Business Operator) and Japan Originated Investment Bank, Inc., which was established in February this year, are unparalleled, completely independent financial consulting firms, that are able to work while remaining close to a wide variety of clients from beginning to end with a high level of sensitivity to imminent capital risk, providing sophisticated analysis and solutions, and consistently undertaking the execution of actual corporate and business restructuring (defense/offense). As highly flexible investment banks that are able to undertake such services, we are continuing to receive a large number of equity consulting contracts with our many highly qualified professionals. In addition, from the previous fiscal year to the fiscal year under review, we continued to achieve an overwhelming track record in large-scale projects of PA services*1 and FA services*2 , including ownership battles such as proxy fights, hostile TOBs, and MBOs, as well as activist responses. With the "Power of Equity®*3 (the power of shareholder voting rights)" as our greatest weapon, we will continue to increase the number of entrustments of large-scale projects in the era of major restructuring, by providing practical, fact-oriented solutions that enhance the confidence of cross-border capital markets.

*1 PA services: Proxy Advisory services (Proxy fight services, in which the Company boasts an overwhelmingly successful track record)

*2 FA services: Financial Advisory services (Responses to activists, hostile TOBs, advanced MBOs, and M&As, to which Japan's largest and most cutting-edge group of experts is deployed)

*3 Power of Equity®: "Power of Equity" is a registered trademark of our subsidiary, IR Japan, Inc. (No. 6196294).

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