Members : Financial Results Briefing for 3Q FY2022

Financial Results for 3Q FY2022

Members Co., Ltd. (TSE 2130)

February 2, 2022

Proprietary and Confidential to Members Co.,LTD

Company Profile

Representative Director and President Tadashi Kenmochi

Members is the internet business partner that aims to create a spiritually rich society through "MEMBERSHIP" by supporting digital business with digital creators.

Corporate name	Members Co., Ltd.
Date of establishment	June 26, 1995
Mission	Create a spiritually rich society through "MEMBERSHIP"
(VISION2030)
Locations	Headquarters: 37th floor of Harumi Island Triton Square Office Tower X, 1-8-10 Harumi, Chuo-ku, Tokyo
	Web Garden Sendai: 8th floor of Daiichi Seimei Tower Bldg., 4-6-1Ichiban-cho,Aoba-ku,Sendai-shi, Miyagi
	Web Garden Kitakyushu: 9th floor of Meiji Yasuda Seimei Kokura Bldg., 9-1Konya-machi,Kokurakita-ku,Kitakyushu-shi, Fukuoka
	Web Garden Kobe: 16th floor of Kobe Commerce Industry and Trade Center Bldg., 5-1-14 Hamabedori, Chuo-ku,Kobe-shi, Hyogo
	Sapporo Office: 5th floor of 11.CONCEPT SPERARE Bldg., 1-1-65Minami-Jujo-Nishi,Chuo-ku,Sapporo-shi, Hokkaido
Capital	936 million yen (as of December 31, 2021)
Sales revenue	12,087 million yen (fiscal year ended March 31, 2021)〔IFRS〕
Securities code	2130; First Section of Tokyo Stock Exchange
No. of employees	1,828 (as of December 31, 2021)
(consolidated)

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Service Features

EMC business	PGT business (*)
(Engagement Marketing Center business)	(Product Growth Team business)

Outline

Digital business operation support service

Websites, EC, SNS, apps, marketing automation (MA), digital transformation (DX), etc.

Features

• Dedicated teams of digital creators for the client companies, which deeply understand the management strategies, goals, products, and services of the clients, drive the digital business.
• Methodization of the operation know-how by the dedicated teams
  ①Improvement in outcomes ②Enhancement of productivity ③Quality and security
  ④Promotion of CSV marketing ⑤Team building ⑥ Account plan ⑦Shift of cutting-edge technology fields
• Specializing in large client companies, large-scale transactions, and continuous projects

Major clients

Shiseido Co., Ltd., SKY Perfect JSAT Corporation, Daikyo Inc., Trend Micro Inc., Panasonic Corporation, Benesse Corporation, Mizuho Bank, Ltd., Sumitomo Mitsui Card Co., Ltd., etc.

Outline

Provision of personnel for supporting the growth of digital products of clients

DX producers, UX designers, data scientists, marketing planners, data engineers, website directors, website designers, engineers, and others

Features

• Provision of autonomous teams of digital creators
• To support growth in the cutting-edge technology fields
  To support the growth of digital products of clients by using the skills in the cutting-edgetechnology field with high added value
• Creators first
  System of appointing creators as executive officers, remote work, and development of a sound working environment

Major clients

• Internet-relatedenterprises with great growth potential
• Social innovation ventures for solving social issues
• Local medium-sized enterprises

* In April 2021, "Digital Personnel business" was renamed "Product Growth Team (PGT) business."	3
Proprietary and Confidential to Members Co.,LTD

3Q FY 2022 Overview

As enterprises actively invested in digital technologies, both sales revenue and operating profit hit a record high in the cumulative third quarter. The service of supporting high value-added specialized domains, including engineering, data, and UX, performed well.

Consolidated results

Sales revenue		Operating profit
10,592 yen	+25.5%	992	yen	+75.8%
million		million
	y/y			y/y

Added-value sales

9,966 million +27.1%

yen y/y

Business situation

EMC business			PGT business			No. of companies	46	-1 from the
				we offer the EMC	previous FY
Sales revenue			Sales revenue			model				end of the
				business		end of the
7,429	million +16.2%	3,680	million +49.8%	creators
				EMC		end of the
						No. of digital	business 921	＋146 from the
	yen	y/y		yen	y/y	previous FY
						PGT	707	previous FY
							+178 from the

		Ratio of sales of
Educational	Up 37 million yen	services other than
investment	y/y	website operation
206 yen		during 22/3Q
	28.5 ％
million

Up 2.7 points compared to 22/2Q

Estimated term-end dividend per share

23.5 yen

Up 6.0 yen from the previous FY

Proprietary and Confidential to Members Co.,LTD	4

Income Statement Summary

Both sales revenue and operating profit hit a record high for 3Q and cumulative 3Q. As new transactions increased and average unit selling price rose, gross profit margin and operating profit margin increased in 3Q. Unprofitable transactions, which emerged in 2Q, are progressing as planned, and it is expected that there will be no additional costs or the like.

		Results in 3Q		Cumulative results until 3Q
[Unit：million yen]	FY3/2021	FY3/2022	y/y	FY3/2021	FY3/2022		y/y
Sales revenue	3,025	3,797	+25.5%	8,436	10,592		+25.5%
Added value sales	2,859	3,584	+25.3%	7,843	9,966		+27.1%
Gross profit	968	1,288	+33.0%	2,549	3,178		+24.7%
(Gross profit margin)	32.0%	33.9%	―	30.2%	30.0%		―
SGA	554	663	+19.6%	1,968	2,202		+11.9%
Operating profit	417	626	+49.9%	564	992		+75.8%
(Operating profit margin)	13.8%	16.5%	―	6.7%	9.4%		―
Pretax profit	414	625	+50.8%	557	989		+77.7%
Net profit	288	427	+48.0%	408	687		+68.3%

* Added value sales = Sales revenue ー Outsourcing and procurement costs ＝ Sales from in-house resources	5
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