Recruit : Annual Report translated from Yukashouken Houkokusho FY2020

This document has been translated from the original document in Japanese ("Yukashouken Houkokusho"), which is legally required for Recruit Holdings as a listed company in Japan to support investment decisions by providing certain information about the Company for the fiscal year ended March 31, 2021 ("FY2020"), under Article 24, Paragraph 1 of the Financial Instruments and Exchange Act of Japan.

The Japanese original document was filed to the Director-General of the Kanto Local Finance Bureau in Japan on June 18, 2021. Please refer to "Note Regarding Reference Translation" below as a general warning for this translation document.

Document Name	Annual Report translated from Yukashouken Houkokusho
Filing Date	June 18, 2021
Fiscal Year	FY2020 (From April 1, 2020 to March 31, 2021)
Company Name in English	Recruit Holdings Co., Ltd.
Title and Name of	Hisayuki Idekoba
Representative	President, CEO and Representative Director of the Board
Address of Head Office	8-4-17 Ginza, Chuo-ku, Tokyo, Japan
	(The above address is a registered headquarters. Actual headquarters
	operation is conducted in the Contact Location below)
Telephone Number	[phone]
Contact Person	Junichi Arai
	Corporate Executive Officer
Contact Location	1-9-2 Marunouchi, Chiyoda-ku, Tokyo, Japan

Definition of Abbreviations

In this document, the terms the "Company," "Recruit Group," "we," and "our" refer to Recruit Holdings Co., Ltd. and its consolidated subsidiaries unless the context indicates otherwise. The "Holding Company" refers to Recruit Holdings Co., Ltd. ("Recruit Holdings") on a standalone basis.

The Company's fiscal year starts on April 1 and ends on March 31 of each year. Accordingly, "FY2020" refers to the period from April 1, 2020 to March 31, 2021. References to "FY" or "fiscal year" indicate 12-month periods commencing in each case on April 1 of the year indicated and ending on March 31 of the following year.

Q1 refers to the three-month period from April 1 to June 30, Q2 refers to the three-month period from July 1 to September 30, Q3 refers to the three-month period from October 1 to December 31, and Q4 refers to the three-month period from January 1 to March 31.

For other definitions, please refer to the chart below.

Abbreviation	Definition
SBU	Strategic Business Unit
IFRS	International Financial Reporting Standards

Definition of Financial Measures

Financial Measures	Definition
Adjusted EBITDA	Operating income + depreciation and amortization (excluding depreciation of right-of-use
	assets) ± other operating income/expenses
Adjusted profit	Profit attributable to owners of the parent ± adjustment items (excluding non-controlling
	interests)
	± tax reconciliation related to certain adjustment items
Adjusted EPS	Adjusted profit / (number of issued shares at the end of the period
	- number of treasury stock at the end of the period)
Profit available for	Profit attributable to owners of the parent ± non-recurring income/losses ± tax reconciliation
dividends	related to certain non-recurring income/losses
Adjustment items	Amortization of intangible assets arising due to business combinations
	± non-recurring income/losses
Non-recurring	Gains or losses from disposals of shares of associates, expenses relating to company
income/losses	restructuring, gains or losses from the sale or impairment of property and equipment, and
	income and expense items that the Company believes are unusual or non-recurring in
	nature which do not reflect the Company's underlying results of operations

Changes of Company Name

The names of the companies in this document are as of March 31, 2021, unless otherwise indicated. The names of the companies that changed during FY2020 are indicated below.

Company Name	Company Name	Date of Change
(prior to the change)	(as of March 31, 2021)
USG People France SAS	RGF Staffing France SAS	December 2020
USG People Interservices NV	RGF Staffing Interservices NV	December 2020
USG People Germany GmbH	RGF Staffing Germany GmbH	February 2021

Also, the names of the companies within Recruit Group that changed between April 1, 2021 and June 18, 2021 are indicated below.

Company Name	New Company Name	Date of Change
(as of March 31, 2021)	(as of June 18, 2021)
USG People Holdings B.V.	RGF Staffing the Netherlands B.V.	April 2021
ADVANTAGE RESOURCING UK	RGF STAFFING UK LIMITED	June 2021
LIMITED

Recruit Co., Ltd., a consolidated subsidiary of the Company, has made an absorption-type merger of the following companies on April 1, 2021:

Recruit Career Co., Ltd., Recruit Jobs Co., Ltd., Recruit Sumai Company Ltd., Recruit Marketing Partners Co., Ltd., Recruit Lifestyle Co., Ltd., Recruit Communications Co., Ltd. and Recruit Technologies Co., Ltd.

Average Exchange Rate During The Period

								(In yen)
		FY2019		FY2020
	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
	cumulative	cumulative	cumulative	cumulative	cumulative	cumulative
US dollar	109.90	108.60	108.65	108.70	107.63	106.93	106.11	106.10
Euro	123.50	121.40	121.04	120.81	118.59	121.34	122.44	123.76
Australian dollar	76.95	75.24	74.91	74.11	70.74	73.32	74.35	76.21

The amount of exchange rate effects on revenue for Q4 FY2020 in this document is calculated by deducting the amount of the nine month period of FY2020 from the amount of the twelve month period of FY2020.

Forward-Looking Statements

This document contains forward-looking statements, which reflect the Company's assumptions, estimates and outlook for the future based on the Company's plans and expectations as of March 31, 2021 unless the context otherwise indicates. There can be no assurance that the relevant forward-looking statements will be achieved. Please note that significant differences between such forward-looking statements and actual results may arise due to various factors, including changes in economic conditions, changes in individual users' preferences and business clients' needs, competition, changes in the legal and regulatory environment, fluctuations in foreign exchange rates, and other factors. Accordingly, readers are cautioned against placing undue reliance on any such forward-looking statements. The Company has no obligation to update or revise any information contained in this document based on any subsequent developments except as required by applicable law or stock exchange rules and regulations.

Note Regarding Reference Translation

This document has been translated from the Japanese language original for reference purposes only and may not be used or disclosed for any other purpose without the Company's prior written consent. In the event of any conflict or discrepancy between this translated document and the Japanese language original, the Japanese language original shall prevail in all respects. The Company makes no representations regarding the accuracy or completeness of this translation and assumes no responsibility for any losses or damages arising from the use of this translation.

Third-Party Information

This document includes information derived from or based on third-party sources, including information about the markets in which we operate. These statements are based on statistics and other information from third-party sources as cited herein, and the Company has not independently verified and cannot assure the accuracy or completeness of any information derived from or based on third-party sources.

U.S. Disclaimer - Unsponsored American Depositary Receipt ("ADR")

The Company does not support or encourage, and has not consented to, the creation of any unsponsored ADR facilities in respect of its securities and in any event disclaims any liability in connection with an unsponsored ADR. The Company does not represent to any depositary institution, bank or anyone nor should any such entity rely on a belief that the Web site of the Company includes all published information in English, currently, and on an ongoing basis, required to claim an exemption under U.S. Exchange Act Rule 12g3-2(b).

Table of contents

Company Overview	1
Key Performance Indicators	1
History	5
Business	9
Major Subsidiaries and Associates	15
Employees	18

Business Overview	19
Management Philosophy and Strategies	19
Risk Factors	28
Management's Discussion and Analysis of Financial Position, Results of Operations,	56
and Cash Flows
Material Contracts	66
Research and Development	66

Facilities	67
Overview of Capital Expenditures	67
Status of Major Facilities	67
Facility Establishment and Disposal Plans	68

Status of Shares, Acquisition of Treasury Stock and Dividend Policy	69
Status of Shares	69
Status of Acquisition of Treasury Stock	85
Basic Policy on Profit Distribution and Dividends	87

Corporate Governance	88
Corporate Governance Overview	88
Leadership	104
Status of Audits	122
Compensation	128
Stocks Held by the Company	136

Financial Information	141
Consolidated Financial Statements and Notes	142
Non-consolidated Financial Statements and Notes	203
Other Information	218
Outline of Share-related Administration of the Company	218
Information on the Parent Company of the Holding Company	219
Other Reference Information	219
Information on the Guarantor of the Holding Company	220

Independent Auditor's Reports

221