Bushiroad : Summary of Consolidated Financial Results for the Third Quarter of the Fiscal Year 2022 (Consolidated)

May 13, 2022

		Summary of Consolidated Financial Results
		for the Third Quarter of the Fiscal Year 2022
		[Japanese standards] (Consolidated)
Company name Bushiroad Inc.
Stock exchange listing	Tokyo
Securities code	7803	URL: https://bushiroad.co.jp/
Representative	President and COO	Yoshitaka Hashimoto
Inquiries:	Director and General Manager of Business Administration
			Toshiyuki Muraoka	TEL:[phone]
Scheduled date to file Quarterly Securities Report	February 14, 2022
Scheduled date to commence dividend payments	N/A
Preparation of supplementary material on financial results: Yes
Holding of financial results meeting:	Yes

(Amounts less than one million yen are rounded down)

1. Consolidate financial results of the third quarter of FY2022 (July 1, 2021 ~ March 31, 2022)

(1) Consolidated operating results (cumulative)				(Percentages indicate year-on-year changes)
	Net sales			Operating profit	Ordinary profit	Net profit attributable to owners of
			parent
	million yen		%		million yen	%	million yen	%	million yen		%
3Q of FY2022	29,023		-		1,967	-	3,208	-	2,033		-
3Q of FY2021	27,154		7.7		423	-80.9	524	-76.2	-161		-

(Note) Comprehensive income	3Q of FY2022:	2,148	million yen	[-%]
		3Q of FY2021:	-16	million yen	[-%]
		Net profit per share	Diluted quarterly net profit per share
		yen			yen
3Q of FY2022		63.70			58.58
3Q of FY2021		-4.99			-

(Notes) 1. The Company has since FY2021 changed its fiscal year end from July 31 to June 30, and unified the whole Group's fiscal year end as June 30. With this change, the previous and current third fiscal periods were different: previous period was from August 1, 2020 to April 30, 2021, and current period was from July 1, 2021 to March 31, 2022. Therefore, year-on-year quarterly increase/decrease (%) are not given.

1. 2. The Company carried out share splitting to split one share into two shares, on October 1, 2021. Net profit per share and diluted net profit per share are calculated assuming that such share splitting was carried out at the beginning of the previous consolidated fiscal year.

2. Consolidated financial position

	Total assets	Net assets	Equity ratio
	million yen	million yen	%
3Q of FY2022	41,308	13,699	31.7
FY2021	37,515	13,894	35.3

(Reference) Shareholders equity	3Q of FY2022:	13,240 million yen
	FY2021:	13,241 million yen

2. Cash dividends

			Annual dividends per share
	1Q-end	2Q-end	3Q-end		Year-end	Total
	yen	yen	yen		yen	yen
FY2021	-	0.00	-		0.00	0.00
FY2022	-	0.00	-
FY2022 (forecasts)					0.00	0.00

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

The Company has since FY2021 (previous term) changed its fiscal year end from July 31 to June 30. Therefore, for FY2021 being a transitional period, the Company set its record dates of interim dividend and year-end dividend as January 31 and June 30, respectively.

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3. Consolidated performance forecasts for FY2022 (July 1, 2021 - June 30, 2022)

(Percentages indicate year-on-year increase/decrease)

	Net sales		Operating profit	Ordinary profit		Net profit attributable	Profit per share
			to owners of parent
	million yen	%	million yen	%	million yen		%	million yen	%	yen
Full-term	40,000	－	2,500	－	4,100		－	2,350	－	73.47

(Notes) 1. Revisions to performance forecasts published most recently: Yes

For details on the revision to the consolidated performance forecasts, please refer to "Notices concerning consolidated performance forecasts for the full term of fiscal year" announced today (May 13, 2022).

1. The Company has since FY2021 changed its fiscal year end from July 31 to June 30, and unified the whole Group's fiscal year end as June 30. The previous consolidated fiscal year was a transitional period for changing fiscal year end, and its term was irregularly 11 months from August 1, 2020 to June 30, 2021. Therefore, year-on-year increase/decrease (%) are not given.
2. The Company carried out share splitting to split one share into two shares, on October 1, 2021. Forecast of net profit per share for FY2022 was calculated taking effects of such share splitting into account.

*Notes

1. Changes in significant subsidiaries during the current quarter consolidated cumulative period

(changes in specified subsidiaries resulting in the change in scope of consolidation):	No
Newly consolidated company N/A; deconsolidated company N/A

1. Application of special accounting methods to the preparation of quarterly consolidated financial statement: Yes
2. Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
3. • Changes in accounting policies due to revisions to accounting standards and other regulations: Yes

② Changes in accounting policies due to other reasons:	No
③ Changes in accounting estimates:	No
④ Restatement of prior period financial statements:	No

1. Number of issued shares (common shares)

1	Total number of issued shares at the end of the period (including treasury stock)
	3Q of FY2022:	33,453,718 shares	FY2021:	33,038,800 shares
2	Number of treasury stock at the end of the period
	3Q of FY2022:	1,659,770 shares	FY2021:	361,052 shares
3
Average number of shares during the period	(quarterly cumulative)
	3Q of FY2022:	31,924,075 shares	3Q of FY2021:	32,339,176 shares

(Note) The Company carried out share splitting to split one share into two shares, on October 1, 2021. "Total number of issued shares at the end of the period", "Number of treasury stock at the end of the period", and "Average number of shares during the period" were calculated assuming that such share splitting had been carried out at the beginning of the previous consolidated fiscal year.

• Quarterly summary of financial results is not included in a quarterly review by a certified public accountant or an auditing firm.
• Explanation regarding appropriate use of the earnings forecast and other special notes

Descriptions about the future such as performance forecasts contained in this document are based on information currently available to the Company and certain presumptions considered as reasonable, and those are not intended to indicate the Company should assure that it would realize such forecasts. Meanwhile, actual performance in the future may differ substantially, influenced by a wide variety of factors.

(How to obtain materials for quarterly financial results briefing)

Video streaming will be provided on the Company's website (scheduled on May 17, 2022, Wednesday, after 15:30 (JST)).

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• Table of Contents: Appendix

1. Qualitative Information regarding the Current Quarter	4
(1)	Descriptions regarding operating results	4
(2)	Descriptions regarding financial position	6
(3)	Descriptions regarding future prospects such as consolidated performance forecasts	6
2. Quarterly Consolidated Financial Statements and Principal Notes	8
(1)	Quarterly Consolidated Balance Sheets	8
(2)	Quarterly Consolidated Statements of Income and Statements of Comprehensive Income	10
Quarterly Consolidated Statements of Income
	For the third quarter consolidated cumulative period	10
Quarterly Consolidated Statements of Income
	For the third quarter consolidated cumulative period	11
(3)	Notes on Quarterly Consolidated Financial Statements	12
(Going Concern Assumption)	12
(Notes in Case of Significant Changes in the Amount of Shareholders' Equity)	12
(Application of Special Accounting Methods to the Preparation of Quarterly Consolidated Financial
Statements)	12
(Change in Accounting Principles)	12
(Segment Information, etc.)	14
(Per share data)	16

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1. Qualitative Information regarding the Current Quarter

(1) Descriptions regarding operating results

It should be noted that descriptions concerning the future in the text are based on judgment of the Company as of the end of the current quarter consolidated fiscal period.

"Partial amendments to the articles of incorporation" was approved at the 14th regular shareholders meeting on October 27, 2020. So the Company has changed its fiscal year end from July 31 to June 30, and unified the whole Group's fiscal year end as June 30. With this change, the previous and current third quarter consolidated fiscal/cumulative periods were different: previous third quarter period was from February 1, 2021 to April 30, 2021 and its cumulative period was from August 1, 2020 to April 30, 2021; current third quarter period was from January 1, 2022 to March 31, 2022 and its cumulative period was from July 1, 2021 to March 31, 2022. Therefore, year-on-year comparison of operating results is omitted.

Japan's economy remained uncertain during the current third quarter consolidated cumulative period due to expansion again of new SARS-CoV-2(COVID-19) variants, surges of raw materials and transportation costs caused by confusions of production and distribution both in Japan and overseas, and also economic concerns arising from Russian invasion of Ukraine.

Under such situation, the whole Group has adopted a policy to hold many small-scale events to prevent risks of spread of infection as it did in the previous quarter. Excitements were brought into contents in preparation for various types of large-scale events and new products planed in the fourth quarter by hosting card game competitions and live music concerts across Japan.

Also, with the change in business policy of Frontwing Lab. Inc., the Company booked goodwill impairment losses arose at the acquisition of the shares

As a result, operating results of the current third quarter consolidated cumulative period were as follows: Net sales of 29,023,655,000 yen; Operating profit of 1,967,898,000 yen; Ordinary profit of 3,208,920,000 yen; and Net quarterly profit attributable to owners of parent of 2,033,691,000 yen.

Operating results of individual business segments are as follows. Meanwhile, segmental net sales include sales to external customers.

1. Digital IP business

Digital IP business segment has four departments: TCG (Trading Card Games) Dept., Games Dept., MD (Merchandising) Dept., and Media Dept. Former MOG (Mobile Online Games) Dept. has been renamed to Games Dept. since the first quarter consolidated fiscal period.

① TCG Dept.

In relation to "Weiss Schwarz", many popular own and other companies' IP products were released including BanG Dream! Girls Band Party! 5th Anniversary" and "HATSUNE MIKU: COLORFUL STAGE!".

Regarding "Cardfight!! Vanguard", a popular Lyrical Booster series "Lyrical Monasterio ~It's a New School Term! ~" , as well as the 10th anniversary products "Triumphant Return of the Brave Heroes" and "Cardfight!! Vanguard 10thAnniversary GiftBox" were released.

With respect to "Rebirth for you", uniquely formatted products are released including 5 units trial deck variation for "STARDOM" and a special deck set for "hololive production 2nd fes. & 3rd fes."

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Regarding English version "Weiss Schwarz", "Mushoku Tensei: jobless reincarnation (mushoku Tensei - Isekai Ittara Honki Dasu -)" was released and remained fared well.

For new TCG "Shadowverse EVOLVE" scheduled to be released on April 28, 2022, preview experience session and beginner workshop were held across Japan toward launch and 5,000 users participated in total.

②Games Dept.

"NJPW STRONG SPIRITS" was released worldwide simultaneously on February 28, 2022. The Company mutually performed promotions with New Japan Pro-Wrestling appealing to wrestling fans and brought excitements through synergies withing the Group.

"BanG Dream! Girls Band Party!" marked the 5th anniversary on March 16, 2022, and many commemorative activities were made including in-game campaigns, commemorative animations, and events.

③MD Dept.

The capsule toys business remained firm as what it was in the second quarter being supported by the stable sales from original capsule toys brand "TAMA-KYU" and other companies' popular IPs including "Genshin" and "The Quintessential Quintuplets". On-site sale at "BanG Dream! Girls Band Party! 5th Anniversary BanG Dream! x Animate World Fair 2022" and "hololive SUPER EXPO 2022" were successfully finished, and each channel also achieved steady performance of sales.

④Media Dept.

Distribution revenue for the production committee of the animation "BanG Dream!" and books/electronic books published by Bushiroad Media Inc., were the mainstay.

"GRISAIA Phantom Trigger Vol. 8", the final volume of "GRISAIA: Phantom Trigger" series for PC adventure game was released by Frontwing Lab. Inc. on February 25, 2022, and TV on air of the IP animation was also announced.

These operations resulted in Net sales of 21,624,121,000 yen and Segment profit of 2,009,551,000 yen for the Digital IP segment.

2. Live IP business

Live IP business segment has two departments: Music Dept. and Sports Dept. ① Music Dept.

Business performance was steady at Bushiroad Music Inc., because sales grew in music /video software and was also increased by holding multiple number of live music events including "Peaky P-key×Lynx Eyes JOINT LIVE TOUR "Higher and Higher" and "#D4DJ_BATTLE_TIME GONG".

Hikosen Theater Company which mainly performs mask musical ended up in a poor result as in the second quarter, due to closures of kindergartens and nurseries and repeated cancellations and limitations based on voluntary criteria of relevant associations.

②Sports Dept.

New Japan Pro-Wrestling Co., Ltd., marked the 50th anniversary of funding in 2022, organized 2 matches of "WRESTLE KINGDOM 16 in TOKYO DOME" and "WRESTLE KINGDOM 16 in YOKOHAMA ARENA" in January 2022. The Company also held an exhibition "NJPW ism" from February 11 to 27, 2022 commemorating the 50th anniversary of founding at Gallery AaMo of Tokyo Dome City, which resulted in a steady Net sales during the current third quarter consolidated fiscal period, as compared to the immediate previous quarter, in all business segments including tickets, goods, and contents.

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