Gurunavi : Consolidated Financial Results for 2Q FY2019

Translation

October 30, 2019

Consolidated Financial Results

for the Second Quarter of the Fiscal Year Ending March 31, 2020

Name of the Listed Company:	Gurunavi, Inc.
Listed Stock Exchanges:	Tokyo Stock Exchange
Stock Code:	2440
URL:	https://corporate.gnavi.co.jp/en/
Representative:	Akio Sugihara, President
Contact:	Teruhisa Yamada, Senior Managing Executive Officer
	TEL: [phone]

Scheduled date to submit Quarterly Securities Report:	October 31, 2019
Scheduled date to commence dividend payments:	December 2, 2019
Preparation of supplementary materials on quarterly financial results: Yes
Holding of quarterly financial results presentation meeting:	Yes (for institutional investors and analysts)

(Millions of yen with fractional amounts discarded, unless otherwise noted.)

1. Consolidated financial results for the second quarter of the fiscal year ending March

31, 2020 (from April 1, 2019 to September 30, 2019)

(1) Consolidated operating results (cumulative)			(Percentages indicate year-on-year changes.)
		Net sales			Operating income		Ordinary income	Net income attributable
					to owners of parent
Six months ended	Millions of yen	%	Millions of yen		%	Millions of yen	%	Millions of yen	%
September 30, 2019	15,163	(5.3)		681	(33.9)	700	(32.8)	484	(28.0)
September 30, 2018	16,004	(8.9)		1,030	(63.5)	1,042	(63.2)	672	(65.1)
Note:	Comprehensive income
	Six months ended September 30, 2019:	¥382 million	[ (46.8%)]
	Six months ended September 30, 2018:	¥718 million	[ (62.8%)]
		Basic earnings		Diluted earnings
		per share			per share
Six months ended		Yen			Yen
September 30, 2019	10.34		10.33
September 30, 2018	14.37		14.35
(2) Consolidated financial position
		Total assets		Net assets		Equity ratio		Net assets per share
As of		Millions of yen		Millions of yen		%		Yen
September 30, 2019		23,291			18,955		81.2		403.64
March 31, 2019		23,797			18,704		78.4		398.48
Reference:	Equity
	As of September 30, 2019:	¥18,905 million	As of March 31, 2019:	¥18,662 million

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2. Cash dividends

				Annual dividends
		First quarter-end	Second quarter-end	Third quarter-end	Fiscal year-end	Total
		Yen	Yen	Yen	Yen	Yen
Fiscal year ended	-	5.00	-	3.00	8.00
March 31, 2019
Fiscal year ending	-	4.00
March 31, 2020
Fiscal year ending
March 31, 2020			-	4.00	8.00
(Forecast)
Note:	Revisions to the cash dividend forecasts most recently announced: None

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2020 (from April 1, 2019 to March 31, 2020)

(Percentages indicate year-on-year changes.)

								Net income		Basic earnings
		Net sales		Operating income	Ordinary income	attributable to
			per share
								owners of parent
		Millions of		Millions of		Millions of		Millions of
		yen	%	yen	%	yen	%	yen	%	Yen
Fiscal year ending	30,800	(5.9)	(2,000)	-	(2,000)	-	(2,050)	-	(43.77)
March 31, 2020
Note:	Revisions to the consolidated earnings forecasts most recently announced: Yes

* Notes

1. Changes in significant subsidiaries during the six months under review (changes in specified subsidiaries resulting in change in scope of consolidation): None
2. Application of special accounting for preparing quarterly consolidated financial statements: Yes
3. Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements after error corrections
4. 1. Changes in accounting policies due to revisions to accounting standards and other regulations: None
   2. Changes in accounting policies due to other reasons: None
   3. Changes in accounting estimates: None
   4. Restatement of prior period financial statements after error corrections: None
5. Number of shares issued (common shares)
6. 1. Total number of shares issued at the end of the period (including treasury shares)

As of September 30, 2019	48,675,100 shares
As of March 31, 2019	48,675,100 shares

1. Number of treasury shares at the end of the period

As of September 30, 2019	1,839,162 shares
As of March 31, 2019	1,839,162 shares

1. Average number of shares during the period (cumulative from the beginning of the fiscal year)

Six months ended September 30, 2019	46,835,938 shares
Six months ended September 30, 2018	46,787,900 shares

• Quarterly financial results are exempt from quarterly review conducted by certified public accountants or an audit corporation.
• Proper use of earnings forecasts, and other special matters

Forward-looking statements, including the consolidated forecasts stated in these materials, are based on information currently available to the Company and certain assumptions deemed reasonable. Consequently, any statements herein do not constitute assurances regarding actual results by the Company. Actual business and other results may differ materially due to various factors.

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Quarterly consolidated financial statements

(1) Consolidated balance sheet

			(Thousands of yen)
		As of March 31,2019	As of September 30,2019
Assets
Current assets
	Cash and deposits	7,630,364	9,009,438
	Notes and accounts receivable - trade	4,536,063	4,054,099
	Accounts receivable - other	1,636,447	1,496,538
	Other	1,099,744	1,339,706
	Allowance for doubtful accounts	(298,993)	(216,169)
	Total current assets	14,603,626	15,683,614
Non-current assets
	Property, plant and equipment	1,163,040	1,027,429
	Intangible assets
	Software	3,745,185	2,746,110
	Other	205,042	99,929
	Total intangible assets	3,950,227	2,846,040
	Investments and other assets	4,080,913	3,734,675
	Total non-current assets	9,194,181	7,608,144
Total assets	23,797,808	23,291,759
Liabilities
Current liabilities
	Notes and accounts payable - trade	229,919	151,580
	Income taxes payable	168,574	268,839
	Provision for bonuses	709,854	599,031
	Provision for point card certificates	328,884	243,077
	Accounts payable - other	2,416,444	1,989,124
	Other	925,868	825,976
	Total current liabilities	4,779,545	4,077,629
Non-current liabilities
	Asset retirement obligations	313,286	257,324
	Other	900	900
	Total non-current liabilities	314,186	258,224
Total liabilities	5,093,731	4,335,854
Net assets
Shareholders' equity
	Share capital	2,334,300	2,334,300
	Capital surplus	2,884,780	2,884,780
	Retained earnings	18,162,181	18,505,766
	Treasury shares	(4,863,326)	(4,863,326)
	Total shareholders' equity	18,517,935	18,861,521
Accumulated other comprehensive income
	Valuation difference on available-for-sale	159,910	70,938
	securities
	Foreign currency translation adjustment	(14,884)	(27,396)
	Total accumulated other comprehensive income	145,026	43,541
Share acquisition rights	41,113	50,841
Total net assets	18,704,076	18,955,904
Total liabilities and net assets	23,797,808	23,291,759
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1. Consolidated statement of income and consolidated statement of comprehensive income Consolidated statement of income (cumulative)

		(Thousands of yen)
	Six months ended	Six months ended
	September 30, 2018	September 30, 2019
Net sales	16,004,335	15,163,680
Cost of sales	4,819,921	5,149,041
Gross profit	11,184,414	10,014,639
Selling, general and administrative expenses	10,154,178	9,333,144
Operating income	1,030,235	681,494
Non-operating income
Interest income	3,057	2,184
Dividend income	2,948	2,987
Other	6,691	13,729
Total non-operating income	12,698	18,902
Non-operating expenses
Foreign exchange losses	595	-
Total non-operating expenses	595	-
Ordinary income	1,042,338	700,396
Extraordinary income
Gain on reversal of share acquisition rights	85	-
Total extraordinary income	85	-
Extraordinary losses
Loss on valuation of investment securities	29,681	-
Total extraordinary losses	29,681	-
Net income before income taxes	1,012,742	700,396
Income taxes	340,443	216,302
Net income	672,299	484,093
Net income attributable to owners of parent	672,299	484,093

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Consolidated statement of comprehensive income (cumulative)

		(Thousands of yen)
	Six months ended	Six months ended
	September 30, 2018	September 30, 2019
Net income	672,299	484,093
Other comprehensive income
Valuation difference on available-for-sale securities	56,192	(88,972)
Foreign currency translation adjustment	(9,889)	(12,512)
Total other comprehensive income	46,303	(101,485)
Comprehensive income	718,602	382,608
Comprehensive income attributable to:
Owners of parent	718,602	382,608

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