Hamee : FY Apr 2022 Q1, Hamee Corp. 3134, Financial report

Consolidated Financial Results for the First Quarter

FY04/22 [Japanese GAAP]

				September 13, 2021
Name of listed company Hamee Corp.	Listed stock exchanges	East
Code Number	3134	URL	https://hamee.co.jp/
Representative	(Title) President and CEO		(Name) Ikuhiro Mizushima
Contact	(Title) Officer, Accounting & Finance Maneger	(Name) Tatsuya Sakurai	(TEL)[phone]
Scheduled date to file	September 13, 2021Scheduled date of commencement of dividend payment -
Quarterly Securities Report
Preparation of supplementary material on quarterly	:	Yes
financial results
Quarterly results briefing		:	None
				(Millions of yen are rounded down.)

FY04/2022 Q1 consolidated result(May 1, 2021 to July 31, 2021)

(1)Consolidated Operating results			(Percentages indicate year-on-year changes.)
								Net profit
	Net sales	Operating income	Ordinary income	attributable to
								owners of parent
	Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%
Q1 FY04/22	2,617		△2.5	327	△21.2	347	△13.2	254	△2.4
Q1 FY04/21	2,684		4.9	415	8.2	400	0.2	260	△10.6

(NOTE) Comprehensive income Q1 FY04/22 252Millions of yen (△10.0%) Q1 FY04/21 281Millions of yen (26.2%)

	Earnings Per share	Diluted Earnings Per share
	Yen		Yen
Q1 FY04/22	16.02		15.96
Q1 FY04/21	16.54		16.39
(2)Consolidated Financial Position
	Total assets	Net assets	Equity Ratio
	Millions of yen	Millions of yen	%
Q1 FY04/22	8,065	6,625	81.0
FY04/21	8,338	6,528	77.1

(Reference) Shareholders' equityQ1 FY04/22 6,529Millions of yen FY04/21 6,429Millions of yen

2.Dividends

		Dividend per share
	End of first	End of		End of the
	second		Year end	Total
	quarter	third quarter
		quarter
	Yen	Yen		Yen	Yen	Yen
FY04/21	-	0.00		-	10.00	10.00
FY04/22	-
FY04/22 (Forecast)		0.00		-	20.50	20.50
(NOTE) Revisions to the most recently announced dividend forecasts	: None

3. Forecasts for the fiscal year ended April 31, 2022 (May 1, 2021 to April 30, 2022)

(Percentages indicate year-on-year changes.)

								Net profit		Earnings Per
	Net sales	Operating income	Ordinary income		Attributable to
		Share
								owners of parent
	Millions of yen	%	Millions of yen	%	Millions of yen	%		Millions of yen		%	Yen
Full year	14,000	13.2	2,250	3.2	2,248	4.6		1,612		3.6	101.53
(NOTE)Revisions to the most recently announced consolidated earnings forecasts	: None

(NOTE)Because we manage our performance on an annual basis, our earnings forecasts are only for the full fiscal year.

※ Notes

(1)Changes of important subsidiaries during the period	: None
(changes in specified subsidiaries resulting in change in scope of consolidation)
New	-	Exclusion	-
(2)Application of particular accounts procedures to the preparation of quarterly		:	None
consolidated financial statements
(3)Changes in accounting policies and changes or restatement of accounting estimates
① Changes in accounting policies caused by revision of accounting standards	:	Yes
② Changes in accounting policies other than ①				:	None
③ Changes in accounting estimates					:	None
④ Restatement					:	None
(4)Number of shares of outstanding(common stock)
① Number of shares outstanding at the end of
Q1 FY04/22	16,267,200	FY04/21	16,255,200
the period(including treasury stock)			Shares			Shares
②Number of treasury shares at the end of the period
Q1 FY04/22		377,549	FY04/21		377,523
				Shares			Shares
③ Average number of shares during the period
Q1 FY04/22	15,885,335	Q1 FY04/21	15,766,779
				Shares			Shares

※ This quarterly financial report is not subject to quarterly review by a certified public accountant or auditing firm. ※ Explanations and other special notes concerning the appropriate use of business performance forecasts

The forward-looking statements, including earnings forecasts, contained in these materials are based on information currently available to the Company and on certain assumptions deemed to be reasonable, and are not promises by the Company regarding future performance. Actual results may differ significantly from these forecasts due to various factors. Please refer to "1. Qualitative information on the current quarter's performance, (3) Explanation of future forecasts such as Consolidated performance Forecasts" on page 3 of the attached material for the assumptions on the performance forecast and notes on the use of the performance forecast.

(Reference only)

In case of any discrepancies between Japanese version and English version, Japanese Language version shall Prevail.

○Accompanying Materials - Contents
1.Qualitative Information on the current quarter's performance ........................................................	2
(1) Explanation of Operating Results ................................................................................	2
(2) Explanation of Financial Position .................................................................................	3
(3) Explanation of future forecasts such as Consolidated performance Forecasts.....................	4
2.Quarter Consolidated Financial Statements...................................................................................	5
(1)Quarterly Consolidated Balance Sheets.........................................................................	5
(2)Quarter Consolidated Statements of Income and Quarterly Consolidated Statements of
Comprehensive Income..............................................................................................	7
(3)Notes to Quarterly Consolidated Financial Statements.....................................................	9
(Notes on the Going Concern Assumption).......................................................................	9
(Notes on Significant Changes in the Amount of Shareholders' Equity)................................	9
(Changes in Accounting Policies) ...................................................................................	9
(Segment Information, etc.) ..........................................................................................	11
(Significant Subsequent Events).....................................................................................	12

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1.Qualitative Information on the current quarter's performance (1)Explanation of Operating Results

In the first quarter of the current consolidated fiscal year, the Japanese economy is in a state of uncertainty, including the reoccurrence of the Declaration of Emergency Situation due to the resurgence of infectious diseases with COVID-19 and soaring marine freight rates due to the worldwide shortage of semiconductors and container shortages, despite the gradual progress of vaccination and positive signs.

Under these circumstances, the status of each business segment in the first quarter of the fiscal year under review was as follows.

• Commerce Business a. Domestic business

Product: In the mainstay iFace series, although there were sales of iPhone SE (second-generation) in the same quarter of the previous year, there were no sales of new models (iPhone) in the same quarter of the previous year, sales of Reflection and AirPods CASE, which are 1 of our mainstay products, were strong, and we were able to secure sales at almost the same level as the previous year. In July 2021, we released Look in Clear as a new iFace series after our mainstay products First Class and Reflection, and in August of the same year we launched upfront bookings for "notebook-type" products, for which there is strong customer demand. We are steadily preparing for a new iPhone sales campaign that will be a major shopping season throughout the year. On the other hand, in light of future product development aimed at strengthening brand power, the number of products to be launched declined as a result of narrowing down the number of product development items for some smartphone accessories such as neckstrap, and the impact of difficulty in purchasing products from other companies' brands, particularly sundries and toys, due to the impact of a shortage in the supply of IC chips.

Wholesale: Compared to the same quarter of the previous year due to the impact of COVID-19 infectious disease, the period covered by the Emergency Declaration, etc. lengthened. As a result, there was no reaction after the termination of the Declaration, which was seen last year, and the impact on both cities and rural areas due to the expansion of the areas covered. As a result, we were unable to exceed the previous year.

Retail: Revenues were down, similar to wholesale, due to the aforementioned product-related impacts, as well as stable growth compared to rapid growth in the same quarter of the previous year despite continued growth in the EC market and the impact of markdowns by competitors.

b. International Business

In the U.S., which handles mainly music toys and character miscellaneous goods, sales increased 29% year on year due to the further acceleration of retail, which has been expanding since the previous year, and wholesale sales grew significantly due to the impact of the economy, which is being resumed. As a result, sales in the U.S. as a whole increased significantly by 89%.

As a result of the above, net sales in the Commerce Business for the first quarter of the current fiscal year were JPY1,899,787 thousand (down 8.9% from the same quarter of the previous fiscal year), and segment income (operating income) was JPY358,855 thousand (down 29.2%).

• Platform Business a. Next Engine

In terms of the number of clients, we were able to efficiently acquire customers as a result of the start of the effects of organizational changes made in the previous fiscal year to strengthen customer success activities. In addition, the churn rate was stable at a low level, resulting in an increase of 210 companies from the previous quarter to 4,949 clients. The average spend per customer increased 2% from the previous quarter to JPY36,525 due to the impact of the EC market, which remained active while stabilizing compared to the same quarter of the previous year. In order to develop services that

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utilize Next Engine data, in addition to making "AI Auto Recommendation" apps paid for, in order to provide new marketing solutions, we will continue to focus on upsell measures and work to continuously strengthen earnings, including starting test marketing with Criteo, which has 1 of the largest advertising networks in Japan and provides targeted advertising services.

b. Hamee Consulting Corp.

Hamee Consulting Corp, which provides sales support consulting for e-commerce businesses, steadily increased revenues thanks to progress in obtaining contracts from large customers. In order to increase contract acquisition in the future, we will focus on strengthening the recruitment of consultants and other measures to further expand earnings. In addition, in August 2021, we launched a proxy for setting up the Next Engine. By pursuing synergies with Next Engine, we aim to improve the profitability of the platform business as a whole.

As a result, the Platform Business posted net sales of JPY656,966 thousand (an increase of 19.5% from the same quarter of the previous year) and segment income (operating income) of JPY272,937 thousand (an increase of 18.3%).

• Others

This is related to new services that cannot be clearly categorized into either the Commerce Business or the Platform Business, and includes Hometown Tax Payment Support Service, Hamic POCKET mobile devices for elementary school students, and RUKAMO ethical net shops.

With regard to the Hometown Tax Payment Support Service , from the beginning of the fiscal year under review, the NTA worked to improve the donation amount of existing contract municipalities by implementing various e-commerce marketing measures, such as the use of advertising strengthened by increasing the number of web designers and the distribution of e-mail magazines, and by developing new return gifts. The NTA steadily proceeded with preparations for November-December, when the hometown tax payment market will be the most active. With regard to Hamic POCKET, we are continuing to work to improve hardware and software in response to customer requests, and we aim to be a product market fit during the fiscal year ending April 2022.

As a result, net sales for the first quarter of the current fiscal year amounted to JPY60,473 thousand (up 20.6% year on year). On the other hand, segment income (operating loss) amounted to a loss of JPY83,390 thousand (loss of JPY81,559 thousand for the same quarter of the previous year).

As a result of the above, for the first quarter of the current fiscal year, net sales were JPY2,617,227 thousand (down 2.5% year on year), operating income was JPY327,864 thousand (down 21.2% year on year), ordinary income was JPY347,690 thousand (down 13.2% year on year), and profit attributable to owners of parent was JPY254,480 thousand (down 2.4% year on year).

As a change in accounting policy, the Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and other standards from the beginning of the first quarter of the current fiscal year. For details, please refer to "2. Quarterly Consolidated Financial Statements and Major Notes, (3) Notes to Quarterly Consolidated Financial Statements (Changes in Accounting Policies)."

(2)Explanation of Financial Position

Assets at the end of the first quarter of the current fiscal year decreased by JPY273,698 thousand from the end of the previous fiscal year to JPY8,065,055 thousand. This was mainly due to a decrease of JPY267,869 thousand in cash and deposits resulting from payment of income taxes and consumption taxes.

Liabilities decreased by JPY370,959 thousand from the end of the previous fiscal year to JPY1,439,742 thousand. This was mainly due to a decrease of JPY348,239 thousand in income taxes payable.

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