DeNA : Consolidated Financial Results for the Three Months Ended June 30, 2022

The following information was originally prepared and published by the Company in Japanese as it contains timely disclosure materials to be submitted to the Tokyo Stock Exchange. This English translation is for your convenience only. To the extent there is any discrepancy between this English translation and the original Japanese version, please refer to the Japanese version.

Consolidated Financial Results

for the Three Months Ended June 30, 2022

[IFRS]

August 10, 2022

Company name: DeNA Co., Ltd.

Stock exchange listing: Tokyo Stock Exchange

Code number: 2432

URL: https://dena.com/intl/

Representative: Shingo Okamura, President & CEO

Contact: Jun Oi, Member of the Board (CFO)

Phone: [phone]

Scheduled date of filing quarterly securities report: August 12, 2022

Scheduled date of commencing dividend payments: ―

Availability of supplementary briefing material on quarterly financial results: Yes

Schedule of quarterly financial results briefing session: Yes (for institutional investors, analysts and the press)

(Amounts are rounded to the nearest million yen.)

1. Consolidated Financial Results for the Three Months Ended June 30, 2022 (from April 1, 2022 to June 30, 2022)

1. Consolidated Operating Results Revenue

Three months ended	Millions of yen	%
34,773	2.1
June 30, 2022
Three months ended	34,054	13.4
June 30, 2021

(% changes from the previous corresponding period)

Operating profit	Profit before tax	Profit for the period
Millions of yen	%	Millions of yen	%	Millions of yen	%
3,964	(27.5)	10,697	(39.3)	7,505	(48.7)
5,471	(56.5)	17,626	21.9	14,641	48.4

Three months ended June 30, 2022 Three months ended June 30, 2021

Profit for the period

attributable to

owners of the parent

Millions of yen	%
7,144	(50.6)
14,455	46.0

Total comprehensive	Basic earnings	Diluted earnings
income for the period	per share	per share
Millions of yen	%	Yen	Yen
2,950	(83.7)	60.27	60.21
18,056	(1.4)	119.81	119.61

(2) Consolidated Financial Position
		Total assets	Total equity	Total equity	Ratio of equity
		attributable to	attributable to
				owners of the parent	owners of the parent
		Millions of yen	Millions of yen	Millions of yen	%
	As of June 30, 2022	334,408	243,729	238,634	71.4
	As of March 31,	340,570	244,907	240,626	70.7
	2022

2. Dividends
					Dividends per share
		End of 1st		End of 2nd		End of 3rd		End of		Total
		quarter		quarter		quarter		year
Fiscal year ended		Yen		Yen		Yen		Yen		Yen
	―	0.00		―		39.00	39.00
March 31, 2022
Fiscal year ending		―
March 31, 2023
Fiscal year ending
March 31, 2023				―		―		―		―
(Forecast)

(Notes) 1. Revisions to recently announced dividend forecast: No

2. The dividend forecast for the fiscal year ending March 31, 2023 has not been determined at this time.

3. Consolidated Financial Results Forecast for the Fiscal Year Ending March 31, 2023 (from April 1, 2022 to March 31, 2023)

The consolidated financial results forecast for the fiscal year ending March 31, 2023 cannot be provided due to the difficulty of reasonably and accurately estimating the figures. However, the Company aims to achieve a year-on-year increase in revenue and operating profit with the exception of one-off gains and losses. For the major factors related to performance that are expected to impact the trends of each business, please refer to "1. Overview of Operating Results and Financial Position (1) Overview of Operating Results for Fiscal 2021 (Outlook for Fiscal 2022)," in the "Consolidated Financial Results for the Fiscal Year Ended March 31, 2022 [IFRS]," announced on May 10, 2022.

* Notes

1. Changes in Significant Subsidiaries during the Period under Review (changes in specified subsidiaries accompanying changes in scope of consolidation): No
2. Changes in Accounting Policies and Changes in Accounting Estimates
3. 1. Changes in accounting policies required by IFRS: No
   2. Changes in accounting policies other than 1) above: No
   3. Changes in accounting estimates: No
4. Number of Shares Issued (common stock)
5. 1. Total number of shares issued at the end of the period (including treasurystock):

As of June 30, 2022	130,210,945 shares
As of March 31, 2022	130,210,945 shares

2) Total number of shares of treasury stock at the end of the period:

	As of June 30, 2022	11,670,305 shares
3)	As of March 31, 2022	11,674,919 shares
Average number of shares during the period:
	Three months ended June 30, 2022	118,538,321 shares
	Three months ended June 30, 2021	120,642,250 shares

(Note) The 186,479 shares of the Company's stock owned by the Stock Grant ESOP Trust account are included in the "Total number of shares of treasury stock at the end of the period" as of June 30, 2022, and the 191,158 shares of the Company's stock owned by the same trust account are included in the "Total number of shares of treasury stock at the end of the period" as of March 31, 2022.

• This report of quarterly consolidated financial results is outside the scope of quarterly review by a certified public accountant or accounting auditor.

• Explanation of the Proper Use of Financial Results Forecast and Other Notes
  (1) Consolidated Financial Results Forecast
  The forward-looking statements herein are based on information available to the Company and certain assumptions deemed reasonable as of the date of publication of this document. They are not intended as the Company's commitment to achieve such forecasts, and actual results may differ significantly from these forecasts due to a wide range of factors.

(2) Dividend Forecast

The Company plans to set the cash dividend forecast for the fiscal year ending March 31, 2023 considering the overall progress in performance and other factors, and promptly announce said expected dividend amount.

(3) Method of Obtaining Supplementary Briefing Material on Financial Results

The Company is planning to hold a briefing session for institutional investors, analysts and the press on August 10, 2022. The briefing materials for this session are scheduled to be posted on the Company's website after the timely disclosure of the Consolidated Financial Results for the Three Months Ended June 30, 2022 on the same date. In addition, videos and primary Q&A of the briefing session are scheduled to be posted on the Company's website at a later date shortly thereafter.

Appendix
1. Overview of Operating Results and Financial Position	2
(1)	Overview of Operating Results	2
(2)	Overview of Financial Position and Cash Flows	3
(3)	Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information	4
2. Condensed Consolidated Financial Statements and Principal Notes	5
(1)	Condensed Consolidated Statement of Financial Position	5
(2)	Condensed Consolidated Income Statement	7
(3)	Condensed Consolidated Statement of Comprehensive Income	8
(4)	Condensed Consolidated Statement of Changes in Equity	9
(5)	Condensed Consolidated Statement of Cash Flows	10
(6)	Notes on Going Concern Assumption	11
(7)	Notes to Condensed Consolidated Financial Statements	11
	1. Segment information	11
	2. Earnings per share	14
	3. Significant subsequent events	14

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1. Overview of Operating Results and Financial Position

(1) Overview of Operating Results

The Group has made efforts to enhance corporate value over the mid to long term by working to form an earnings base on the two approaches of working to entertain and to serve and by evolving into a new kind of tech company, including encouraging synergy between the two approaches. The Group has also been working to establish an even stronger business portfolio.

During the three months ended June 30, 2022 (from April 1, 2022 to June 30, 2022), revenue was ¥34,773 million, up 2.1% year-on-year. While revenue decreased year-on-year in the Game Business, the Sports Business recovered and the Live Streaming Business grew.

Cost of sales was ¥17,412 million, up 9.0% year-on-year. Commission fees, etc., which fluctuate in line with the performance of the Live Streaming Business and the Game Business, etc. primarily increased.

Selling, general and administrative expenses were ¥13,817 million, up 4.1% year-on-year. Sales promotion expenses and advertising expenses increased primarily for the Live Streaming Business, while outsourcing expenses and commission fees declined, reflecting the performance of the Game Business.

Other income, net was ¥420 million, compared to ¥665 million for the same period of the previous fiscal year. Share of loss of associates accounted for using the equity method was ¥189 million, compared with share of profit

of associates accounted for using the equity method of ¥9,403 million in the same period of the previous fiscal year. The main factors of the year-on-year fluctuation included the performance trends of Cygames, Inc., a major associate accounted for using the equity method, as well as the recording of a one-time gain from the capital increase of Mobility Technologies Co., Ltd. through a third-party allotment in the same period of the previous fiscal year.

As a result, revenue of the DeNA Group was ¥34,773 million, up 2.1% year-on-year, operating profit was ¥3,964 million, down 27.5% year-on-year, profit before tax was ¥10,697 million, down 39.3% year-on-year, and profit for the period attributable to owners of the parent was ¥7,144 million, down 50.6% year-on-year.

Business performance by segment is as follows.

1. Game Business
   Revenue of the Game Business was ¥15,774 million, down 15.9% year-on-year, and segment profit was ¥1,712 million, down 48.5% year-on-year.
   During the three months ended June 30, 2022, both revenue and profit decreased as operations were centered on existing titles and virtual currency consumption decreased year-on-year. To strengthen the earnings base, in addition to the release of new titles, the Company continues to strive to make the cost structure more robust and optimize fixed costs.
2. Sports Business

Revenue of the Sports Business was ¥7,931 million, up 36.3% year-on-year, and segment profit was ¥2,579 million, up 151.7% year-on-year.

Although the current situation still requires close attention to COVID-19 trends, the performance of the Sports Business recovered significantly compared to the same period of the previous fiscal year, during which the number of spectators had to be restricted.

3) Live Streaming Business

Revenue of the Live Streaming Business was ¥9,647 million, up 21.4% year-on-year, and segment loss was ¥188 million, compared with segment profit of ¥1,640 million for the same period of the previous fiscal year.

During the three months ended June 30, 2022, Pococha continued to perform solidly in Japan. In addition, the global Pococha service as well as the anime character live streaming service IRIAM saw good usage trends. The Company made proactive growth investments in these areas.

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