The original disclosure in Japanese was released on October 20, 2017 at 15:15 (GMT+9). This is a summary translation of a press release made in Japanese for convenience only.

JAFCO Co., Ltd. (Ticker: 8595) Contact: Investor Relations 1-5-1 Otemachi, Chiyoda-ku Tel: +81-3-5223-7073

Tokyo 100-0004 Japan ir@jafco.co.jp

http://www.jafco.co.jp

October 20, 2017

Financial Results for the Six Months Ended September 30, 2017

[Japanese GAAP]

(Summary of Japanese announcement)

(Japanese yen figures less than one million yen are rounded down)

  1. Consolidated Performance for the Six Months Ended September 30, 2017 (April 1, 2017 - September 30, 2017)
  2. Consolidated Operating Results

    Note: Comprehensive income Six months ended September 30, 2017:

    ¥12,851 million (

    -%)

    Six months ended September 30, 2016:

    negative ¥1,262 million (

    -%)

    (figures with % indicate the rate of change from the same period of the previous fiscal year)

    Net sales

    [¥ million] [%]

    Operating income [¥ million] [%]

    Ordinary income [¥ million] [%]

    Profit attributable to JAFCO Co., Ltd.

    stockholders [¥ million] [%]

    For six months ended September 30, 2017

    17,763

    49.8

    9,147

    86.2

    10,020

    90.0

    19,754

    293.9

    For six months ended September 30, 2016

    11,857

    (51.8)

    4,912

    (67.2)

    5,273

    (65.0)

    5,015

    (56.8)

    Profit per share [¥]

    Fully diluted net income per share [¥]

    For six months ended September 30, 2017

    498.92

    -

    For six months ended September 30, 2016

    113.04

    -

  3. Consolidated Financial Position
  4. Total assets [¥ million]

    Net assets [¥ million]

    Equity ratio [%]

    Net assets per share [¥]

    As of September 30, 2017

    188,244

    155,001

    82.3

    5,011.17

    As of March 31, 2017

    237,902

    207,855

    87.4

    4,684.87

    (Reference) Shareholders' equity As of September 30, 2017: ¥155,001 million

    As of March 31, 2017: ¥207,855 million

  5. Dividends

    Dividend per share [¥]

    (Record date)

    End of 1Q

    End of 2Q

    End of 3Q

    End of the year

    Total

    For the year ended March 31, 2017

    -

    -

    -

    100.00

    100.00

    For the year ending March 31, 2018

    -

    -

    For the year ending

    March 31, 2018 (Forecast)

    -

    -

    -

    Notes: The forecast of dividend amount is unfixed.

  6. Business Forecasts (April 1, 2017 - March 31, 2018)

    Volatility in stock markets and the IPO environment in Japan and overseas causes performance to fluctuate, as a result of which it is difficult to make meaningful forecasts in earnings. Therefore, instead of announcing projections, JAFCO makes timely disclosure of quarterly financial results.

    *Other Information
  7. Changes in significant subsidiaries during this period: None

  8. Adoption of specific accounting methods for the preparation of quarterly consolidated financial statements: None

  9. Changes in accounting principles, accounting estimates and correction of prior period errors

    Changes in accounting principles due to revisions to accounting standards: None

    Changes in accounting principles other than: None

    Changes in accounting estimates: None

    Correction of prior period errors: None

  10. Number of issued shares (common stock)

  11. Number of issued shares (including treasury stock)

    As of September 30, 2017: 32,550,000 As of March 31, 2017: 48,294,336

    Number of treasury stock

    As of September 30, 2017: 1,618,827 As of March 31, 2017: 3,926,884

    Average number of shares

    For six months ended September 30, 2017: 39,594,991

    For six months ended September 30, 2016 44,367,645

    *Disclosure regarding the implementation of audit procedures

    This financial summary is not subject to quarterly review procedures by auditors.

    *Cautionary statements with respect to forward-looking statements and other notes

    (Access to the financial supplement materials)

    The presentation material for the six months ended September 30, 2017 was released on JAFCO's website on October 20, 2017.

    *Note to XBRL

    Please note that the names of the English accounts contained in XBRL data, which are available through EDINET and TDNet, may be different from those of the English accounts in our financial statements.

    1. Qualitative Analysis and Financial Statements (1) Qualitative Analysis of Consolidated Operating Results

    JAFCO posted net sales of ¥17,763 million, ordinary income of ¥10,020 million, and profit attributable to JAFCO Co., Ltd. stockholders of ¥19,754 million in the consolidated fiscal six months ended September 30, 2017. This compares with net sales of ¥27,857 million, ordinary income of ¥13,666 million, and profit attributable to JAFCO Co., Ltd. stockholders of ¥11,073 million for the previous full year ended March 31, 2017 (the "previous full year").

    During the six months ended September 30, 2017, ¥18,348 million in gains on the partial sale of shares in Nomura Research Institute were recorded as extraordinary income.

    (Outline of Investments)

    The JAFCO Group and its funds made investments totaling ¥14,522 million (35 companies) in the six months ended September 30, 2017, compared with ¥20,904 million (55 companies) in the previous full year.

    (Outline of Capital Gains and IPOs)

    JAFCO posted ¥13,976 million in revenues from operational investment securities (previous full year:

    ¥20,774 million). Capital gains came to ¥8,264 million (previous full year: ¥8,800 million), out of which capital gains on listed shares were ¥5,233 million (previous full year: ¥6,499 million) and capital gains on unlisted shares were ¥3,031 million (previous full year: ¥2,301 million). This ¥3,031 million consisted of ¥5,406 million (previous full year: ¥5,893 million) in gains on sale and ¥2,375 million (previous full year: ¥3,592 million) in losses on sale.

    There were five IPOs in Japan and none overseas by portfolio companies of the JAFCO Group and its funds (previous full year: six IPOs in Japan and three overseas).

    (Millions of Yen)

    For the year ended March 31,

    2017 (A)

    For six months ended September 30,

    2016

    For six months ended September 30,

    2017 (B)

    Annualized comparison [(B)×2]/(A) (%)

    Revenues from operational investment securities (1)

    20,774

    9,467

    13,976

    134.6

    Proceeds from sale of securities

    20,533

    9,359

    13,889

    135.3

    Dividend and interest income

    240

    107

    86

    72.0

    Cost of operational investment securities (2)

    11,973

    5,987

    5,711

    95.4

    Cost of securities sold

    11,973

    5,987

    5,711

    95.4

    Impairment

    -

    -

    -

    -

    Capital gains (1) - (2)

    8,800

    3,479

    8,264

    187.8

    Multiple (1) / (2)

    1.74

    1.58

    2.45

    -

    Capital gains on listed shares

    6,499

    1,380

    5,233

    161.0

    Capital gains on unlisted shares

    2,301

    2,099

    3,031

    263.5

    Gains on sale

    5,893

    3,729

    5,406

    183.5

    Losses on sale

    3,592

    1,630

    2,375

    132.2

    (Outline of Investment Loss Reserves)

    JAFCO makes investment loss reserves for operational investment securities after taking investees' business performance into consideration. Company-by-company reserves are made if the estimated recovery amount falls below 70% of acquisition cost. General reserves had been made to cover all other unlisted portfolio companies based on our accumulated expertise in private equity. However, investments made from January 2017 onward are no longer subject to general reserves because the quality of investments has enhanced and more accurate valuation has become possible as a result of the highly selective, intensive investment strategy.

    Additions to investment loss reserves for the six months ended September 30, 2017 totaled ¥1,344 million, consisting of ¥1,897 million in company-by-company reserves and a reversal of ¥553 million in general reserves, compared with ¥1,905 million, ¥2,006 million and a reversal of ¥101 million respectively in the previous full year.

    Company-by-company reserves were reversed by ¥1,929 million following the sale and impairment of securities in the six months ended September 30, 2017, compared with ¥4,741 million reversed in the previous full year. As a result, net additions to investment loss reserves were negative ¥584 million, compared with negative ¥2,835 million in the previous full year.

    Balance of investment loss reserves came to ¥11,752 million (24.1% of the balance of unlisted operational investment securities) as of September 30, 2017, compared with ¥12,332 million (25.9% of the balance of unlisted operational investment securities) at the end of the previous full year.

    (Millions of Yen)

    For the year ended March 31,

    2017 (A)

    For six months ended September 30,

    2016

    For six months ended September 30,

    2017 (B)

    Annualized comparison [(B)×2]/(A) (%)

    Additions to investment loss reserves (1)

    1,905

    687

    1,344

    141.1

    Company-by-company reserves

    2,006

    609

    1,897

    189.1

    (Reversal of) General reserves

    (101)

    78

    (553)

    -

    Reversal of investment loss reserves (2)

    4,741

    2,695

    1,929

    81.4

    Net additions = (1)-(2) (minus figures are reversals)

    (2,835)

    (2,007)

    (584)

    -

    (Millions of Yen)

    As of March 31, 2017

    As of September 30, 2017

    Balance of investment loss reserves

    12,332

    11,752

    Company-by-company reserves

    9,091

    9,064

    General reserves

    3,241

    2,688

    Ratio for all unlisted operational investment securities

    25.9%

    24.1%

JAFCO Co. Ltd. published this content on 20 October 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 20 October 2017 06:21:08 UTC.

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