Accordia Golf : Consolidated Financial Results for the First Half of the Fiscal Year Ending March 31, 2017 (Japanese Accounting Standards)

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Consolidated Financial Results for First Half of the Fiscal Year Ending March 31, 2017 (Japanese Accounting Standards)‌‌‌

November 10, 2016 Company Name: Accordia Golf Co., Ltd. Listing Exchanges: First section of the Tokyo Stock Exchange Securities Code: 2131 URL: http://www.accordiagolf.com

Representative: (Title) President & CEO (Name) Yuko Tashiro For Inquiries, Contact: (Title) Member of the Board and Managing Executive Officer (Name) Takabumi Suzuki

TEL: [phone]

Planned Submission Date for the Quarterly Report: November 11, 2016 Planned Starting Date for Dividend Payments: -

Supplementary documents for quarterly results: YES

Quarterly results briefing: YES (for analysts and institutional investors)

(Rounded down to nearest million yen)

1. Consolidated Performance for the First Half of the Fiscal Year Ending March 31, 2017 (April 1, 2016 - September 30, 2016)

   Operating Revenues		Operating Income		Ordinary Income		Profit Attributable to Owners of Parent
   FY 3/2017 H1	Yen millions	%	Yen millions	%	Yen millions	%	Yen millions	%
   	24,699	(1.3)	3,123	(9.7)	2,961	(22.3)	2,322	(7.4)
   FY 3/2016 H1	25,030	(39.4)	3,458	(29.0)	3,811	416.4	2,507	(37.2)

2. Consolidated Operating Performance (Cumulative) (% indicates year-on-year change)

   (Note) Comprehensive Income FY 3/2017 H1: 2,330 million yen (-6.7%) FY 3/2016 H1: 2,498 million yen (-36.2%)

   	Net Income per Share	Fully-Diluted Net Income per Share
   FY 3/2017 H1	Yen	Yen
   	32.93	-
   FY 3/2016 H1	35.55	-

   (Notes)Fully-diluted net income per share are not presented as there are no dilutive potential shares.

   	Total Assets	Net Assets	Equity Ratio
   FY 3/2017 H1	Yen millions	Yen millions	%
   	150,907	49.831	32.8
   FY 3/2016	152,054	50,045	32.7

3. Consolidated Financial Position

4. Reference: Shareholders' Equity FY 3/2017 H1: 49,567 million yen FY 3/2016: 49,783 million yen

5. Dividends

   	Dividends per Share
   (Record Date)	End of Q1	End of Q2	End of Q3	Fiscal Year End	Annual
   FY 3/2016	Yen	Yen	Yen	Yen	Yen
   	-	0.00	-	36.00	36.00
   FY 3/2017	-	0.00
   FY 3/2017 (Forecast)	-	36.00	36.00

   (Note) Revisions to dividend forecasts published most recently: NO

6. Forecasts for Consolidated Performance for the Fiscal Year Ending March 31, 2017 (April 1, 2016 - March 31, 2017)

7. (% indicates year-on-year change)

   	Operating Revenues		Operating Income		Ordinary Income		Profit Attributable to Owners of Parent		Net Income per Share
   Full Year	Yen millions	%	Yen millions	%	Yen millions	%	Yen millions	%	Yen
   	48,700	0.3	7,300	(0.1)	7,300	(10.3)	4,500	(17.6)	63.83

   (Note) Revisions to performance forecasts published most recently: NO

   • Notes

   • Changes in significant subsidiaries during the term under review (changes in subsidiaries via share exchange causing a change in the scope of consolidation): NO

     New: -- company	(company name:	)
     Eliminated: -- company	(company name:	)

   • Adoption of accounting treatment unique to the preparation of quarterly consolidated financial statements: NO

   • Changes in accounting policies and changes or restatement of accounting estimates

   • Changes in accounting policies associated with the revision of accounting standards, etc.: NO

   • Changes in accounting policies other than (i): NO

   • Changes in accounting estimates: NO

   • Restatement: NO

     End of FY 3/2017 H1	84,739,000 shares
     End of FY 3/2016	84,739,000 shares
     End of FY 3/2017 H1	14,234,433 shares
     End of FY 3/2016	14,234,433 shares
     End of FY 3/2017 H1	70,504,567 shares
     End of FY 3/2016 H1	70,504,604 shares

   • Number of shares issued (common stock)

   • Shares Outstanding (incl. treasury stock):

   • Treasury Stock:

   • Average Number of Shares Outstanding (cumulative of consolidated quarters)

   • Explanation about the quarterly review of consolidated financial statements

     This financial summary does not need to undergo a quarterly review under the Financial Instruments and Exchange Act. The quarterly consolidated financial statements under the Financial Instruments and Exchange Act have been reviewed at the time of the announcement of this financial summary.

   • Explanation on proper use of earnings forecasts and other noteworthy items

   The forecasts provided above have been prepared based on currently available information, and includes many uncertainties. Actual results may differ significantly from the above forecasts for various reasons.

   For details, please refer to "1. (3) Information on future forecast including consolidated earnings forecast" of the accompanying materials.

   ACCORDIA GOLF Co., Ltd. (2131) Financial Results for the First Half of the Fiscal Year Ending March 31, 2017

    Accompanying Materials - Contents
8. Qualitative Information on Consolidated Results, etc. for the First Half Ended September 30, 2016 2

9. Qualitative information on consolidated results 2

10. Qualitative information on consolidated financial position 3

11. Information on future forecast including consolidated earnings forecast 4

12. Matters Relating to Summary Information (Notes) 4

13. Changes in significant subsidiaries during the quarter under review 4

14. Adoption of accounting treatment unique to the preparation of quarterly consolidated financial statements 4

15. Changes in accounting policies and changes or restatement of accounting estimates 4

16. Consolidated Quarterly Financial Statements 5

17. Consolidated quarterly balance sheet 5

18. Consolidated quarterly statements of income and comprehensive income 7

19. Consolidated quarterly statement of cash flows 9

20. Notes on quarterly consolidated financial statements 11

21. (Notes concerning the going concern assumption) 11

    (Notes concerning extreme changes in shareholders' equity) 11

22. Supplementary Information 12

23. Production, orders received, and sales 12

    ACCORDIA GOLF Co., Ltd. (2131) Financial Results for the First Half of the Fiscal Year Ending March 31, 2017

    1. Qualitative Information on Consolidated Results, etc. for the First Half Ended September 30, 2016

    (1) Qualitative information on consolidated results

    During the first half of the consolidated fiscal year under review, demand for golfing remained generally stable in the golf industry where the Accordia Golf Group operates. However, poor summer weather in August and September caused cancellations to increase.

    In these circumstances, the Accordia Golf group, while taking steps to increase the number of rounds played at facilities operated, pursued the basic strategies adopted in the new Medium-Term Management Plan (Accordia Vision 2017), whose final year is fiscal 2017 ("creation of capital gains based on a circulating business model" and "creation of stable cash flows from expanded outsourced management business"), and implemented the following management policies.

    Golf Course Management Business

    The Group stepped up efforts to offer valuable products and services to customers at reasonable prices, and took measures to attract customers through the introduction of a golf course brand and an original loyalty program and stronger coordination with driving ranges. However, the number of rounds played at the Group's golf courses (owned or managed under contract by the Group) totaled 4.4 million (a decrease of 50,000 from the same period of the previous fiscal year) in the first half under review, reflecting voluntary golfing restraint under the effects of the 2016 Kumamoto Earthquakes in the Kyushu Region, poor summer weather and the sale of two golf courses in the previous fiscal year.

    Optimization of Golf Course Portfolio through Acquisition of Golf Courses

    The Group is studying golf courses recommended for acquisition in a bid to acquire them in the current and subsequent fiscal years. In the meantime, as part of its golf course portfolio strategies, the Group sold one golf course in Hokkaido expected to generate less revenue in the future. As a result, the Group operated 135 golf courses (including 42 courses owned by the Group and 93 courses managed under contract for operations) as of the end of the first half under review.

    Driving Range Operation Business

    The Group advanced measures for attracting customers and bolstered its services by providing a satisfying practice environment, operating golf schools and coordinating more closely with other operators in sending customers to golf courses. The Group also closed an unprofitable indoor driving range in metropolitan Tokyo, and opened the Accordia Golf Studio in Minato-ku, Tokyo, as an indoor driving range under a new brand. As a result, the Group operated 26 driving ranges as of the end of the first half under review.

    Business trust-based asset-light strategy

    The Company is continuing efforts to improve the revenue of its golf courses to further improve its asset efficiency, and is making intensive preparations for additional asset-light strategies for golf courses with confirmed stable profitability.

    Consequently, the Group recorded operating revenue of 24,699,087,000 yen, a decrease of 331,137,000 yen, or 1.3% year on year, for the first half under review.

    Reflecting the decline in operating revenue stated above, operating income for the Group decreased 334,697,000 yen, or 9.7% year on year, to 3,123,842,000 yen.

    Ordinary income decreased 849,720,000 yen, or 22.3% year on year, to 2,961,476,000 yen, mainly due to a fall of 311,817,000 yen in equity in earnings of affiliates and an increase of 247,499,000 yen in syndicate loan fees associated with new borrowing.

    Profit attributable to owners of the parent decreased 184,842,000 yen, or 7.4% year on year, to 2,322,272,000 yen, primarily reflecting a fall of 933,932,000 yen in total income taxes that resulted from a 562,297,000 yen in gain on transfer of rights in connection with the transfer of the photovoltaic power generation business in the first half of the previous fiscal year, the absence of an 115,239,000 yen impairment loss posted in the first half of the previous fiscal year and a decline in income taxes - deferred.