As of November 9, 2018

Qualitative Information on Consolidated Operating Results

The Japanese economy during the six months ended September 30, 2018, followed a moderate recovery trend as corporate earnings and the employment and income environment continued to improve. Meanwhile, a sense of uncertainty about the economic outlook increased amid uncertainty in overseas economies including the intensified trade friction between the U.S. and China, in addition to rising crude oil prices and concern about the impact of fluctuations in financial and capital markets, as well as the impact of repeated natural disasters.

In the printing industry, the operating environment remained tough, reflecting declining demand for paper media owing to the impact of the shift to digital information media associated with the increased use of IT and falling unit prices caused by intensified competition. Also, there are growing needs for products and services that consider reduction of the environmental burden, such as CO2 reduction and resource recycling across the entire supply chain, as companies step up ESG (Environment, Social, and Governance) initiatives.

Amid this environment, Toppan Printing Co., Ltd. (the “Company”) and its group companies (collectively, the “Group”) identified Healthcare & Life Sciences, Education & Cultural Exchange, Urban Space & Mobility, and Energy & Food Resources as four business fields for growth for TOPPAN VISION 21, which sets out Toppan’s Corporate Structure and Business Fields for the 21st century. Guided by the concept of “Designing Infinite Possibilities – Discover the Value of the Future. Make it Real with Planning and Creativity,” the Group strives to expand its business by realizing total solutions through enhanced Group collaboration and combinations of technologies and knowhow. In order to establish new revenue models at an early stage, the Group will work to proactively put management resources into new businesses. Meanwhile, in existing businesses, the Group will work to enhance competitiveness by strengthening the technology development and reducing costs.

As a result, for the six months ended September 30, 2018, net sales decreased by 0.9% from the same period of the previous year to ¥698.2 billion. Further, operating profit decreased by 27.1% to ¥10.7 billion, ordinary profit decreased by 21.2% to ¥13.7 billion, and profit attributable to owners of parent was ¥8.2 billion, a 47.6% decrease.

Overview of consolidated performance in the current quarter