Money Forward : Summary of Consolidated Financial Results for the Six Months Ended May 31, 2022

Translation

Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results

for the Six Months Ended May 31, 2022

(Based on Japanese GAAP)

July 13, 2022

Company name:	Money Forward, Inc.
Stock exchange listing:	Tokyo
Stock code:	3994	URL https://corp.moneyforward.com
Representative:	Representative Director, President and CEO	Yosuke Tsuji
Inquiries:	Executive Officer and Accounting	Shun Matsuoka	TEL [phone]
Department Manager
Scheduled date to file Quarterly Securities Report:	July 13, 2022
Scheduled date to commence dividend payments:	-
Preparation of supplementary material on quarterly financial results:	Yes
Holding of quarterly financial results meeting:	Yes	(for institutional investors and analysts)

(Amounts less than one million yen are rounded down)

1. Consolidated financial results for the six months ended May 31, 2022 (from December 1, 2021 to May 31, 2022)

(1) Consolidated operating results (cumulative)						Percentages indicate year-on-year changes
	Net sales		SaaS ARR*1	EBITDA*2		Operating profit	Ordinary profit
	Millions of yen		%	Millions of yen	%	Millions of yen		%	Millions of yen	%	Millions of yen	%
Six months ended May 31, 2022	9,841		31.9	13,976	37.9	(2,734)		-	(3,796)	-	(3,875)	-
Six months ended May 31, 2021	7,460		43.1	10,132	39.0	648		-	44	-	28	-
(Note)Comprehensive income (millions of yen)
Six months ended May 31, 2022: (3,671) (-%). Six months ended May 31, 2021: 29 (-%)
	Profit attributable	Earnings per share	Diluted earnings
	to owners of parent	per share
	Millions of yen		%		Yen		Yen
Six months ended May 31, 2022	(3,887)		-		(72.78)			-
Six months ended May 31, 2021	20		-		0.43	0.41

*1 SaaS ARR is 12 times the monthly recurring revenue of Home, Business, X and Finance domains in the last month of each term. In order to adjust for seasonal factors of STREAMED, its MRR is calculated as one-third of the revenue from STREAMED in Q1 and Q2 of each fiscal year (rounded to the nearest million yen).

*2 EBITDA=Operating profit(loss) + depreciation and amortization + tax expenses included in operating expenses + share-based remuneration expenses

(Note) Diluted earnings per share for the six months ended May 31, 2022 is not disclosed because it is anti dilutive due to the Company's net loss position.

(2) Consolidated financial position
	Total assets		Net assets		Equity ratio
	Millions of yen	Millions of yen		%
As of May 31, 2022	66,422	40,048		56.4
As of November 30, 2021	56,942	42,332		71.1
(Reference) Equity (millions of yen) As of May 31, 2022: 37,469. As of November 30, 2021: 40,491.
2. Cash dividends
			Annual dividends per share
	1st quarter-end	2nd quarter-end		3rd quarter-end	Fiscal year-end	Total
	Yen		Yen			Yen	Yen	Yen
Year ended November 30, 2021	-		0.00			-	0.00	0.00
Year ending November 30, 2022	-		0.00
Year ending November 30, 2022						-	0.00	0.00
(Forecast)
(Note) Revisions to most recent dividend forecast: None

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3. Forecast of consolidated financial results for the year ending November 30, 2022 (from December 1, 2021 to November 30, 2022)

In the fiscal year ending November 30, 2022, the Company will execute investments more flexibly mainly in Business domain, while monitoring the return on investment and market environment. As such, it is difficult to calculate a reasonable earnings forecast for the full year, and the Company plans to continuously disclose the earnings forecast for the next quarter.

									Percentages indicate year-on-year changes
	Net sales		SaaS ARR*1	EBITDA*2
	Millions of yen	%	Millions of yen		%	Millions of yen		%
Full year	20,322	30.0	15,718		40.0	-		-
~21,886	~40.0	~16,841		~50.0
	Operating profit	Ordinary profit	Profit attributable to	Earnings per share
	owners of parent
	Millions of yen	%	Millions of yen		%	Millions of yen		%	Yen
Full year	-	-	-		-	-		-	-
			The percentages indicate changes from the same period of the previous fiscal year
	Net sales		SaaS ARR		EBITDA
	Millions of yen	%	Millions of yen		%	Millions of yen		%
Three months ending	5,175	35.0	14,605		39.0	(2,200)		-
August 31, 2022	~5,405	~41.0	~15,025		~43.0	~(1,700)
	Operating profit	Ordinary profit	Profit attributable to	Earnings per share
	owners of parent
	Millions of yen	%	Millions of yen		%	Millions of yen		%	Yen
Three months ending	(2,850)	-	(2,870)		-	(2,920)		-	(54.33)
August 31, 2022	~(2,350)	~(2,370)		~(2,420)		~(45.03)

(Note) Revisions to most recent dividend forecast: None

*1 SaaS ARR is 12 times the monthly recurring revenue of Home, Business, X and Finance domains in the last month of each term. In order to adjust for seasonal factors of STREAMED, its MRR is calculated as one-third of the revenue from STREAMED in Q1 and Q2 of each fiscal year (rounded to the nearest million yen).

*2 EBITDA=Operating profit(loss) + depreciation and amortization + tax expenses included in operating expenses +share-based remuneration (Note) Advertising expenses for the nine months ending August 31, 2022, are expected to range from 1,800 million yen to 2,000 million yen.

4. Notes
(1)	Changes in significant subsidiaries during the six months ended May 31, 2022	No
	(changes in specified subsidiaries resulting in the change in scope of consolidation):
(2)	Application of special accounting methods for preparing quarterly consolidated financial statements:	Yes

(3) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements

Changes in accounting policies due to revisions to accounting standards and other regulations:	Yes
Changes in accounting policies due to other reasons:	No
Changes in accounting estimates:	No
Restatement of prior period financial statements:	No

(4) Number of issued shares (common shares)

Total number of issued shares at the end of the period (including treasury shares)

	As of May 31, 2022	53,654,860	shares	As of November 30, 2021	53,382,460	shares
Number of treasury shares at the end of the period
	As of May 31, 2022	49,171	shares	As of November 30, 2021	36,475	shares

Average number of shares during the period (cumulative from the beginning of the fiscal year)

Six months ended May 31, 2022

53,417,679 shares

Six months ended May 31, 2021

47,829,028 shares

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Quarterly Consolidated Financial Statements

Consolidated Balance Sheets

			(Thousands of yen)
		As of November 30, 2021	As of May 31, 2022
Assets
Current assets
Cash and deposits	36,220,522	30,438,339
Notes and accounts receivable - trade	1,516,402	-
Notes and accounts receivable - trade, and contract	-	1,762,158
assets
Operational investment securities	1,074,286	1,590,182
Inventories	21,762	14,420
Purchased receivables	4,222,155	5,906,301
Other	1,073,146	1,981,955
Allowance for doubtful accounts	(102,517)	(75,987)
Total current assets	44,025,758	41,617,371
Non-current assets
Property, plant and equipment	537,330	620,145
Intangible assets
Goodwill	3,068,762	4,839,144
Software	2,313,203	3,188,780
Software in progress	723,223	1,356,992
Total intangible assets	6,105,189	9,384,916
Investments and other assets
Investment securities	5,006,164	12,834,190
Leasehold and guarantee deposits	606,325	729,030
Other	712,468	1,287,915
Allowance for doubtful accounts	(50,678)	(50,678)
Total investments and other assets	6,274,279	14,800,457
Total non-current assets	12,916,799	24,805,520
Total assets	56,942,558	66,422,891

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			(Thousands of yen)
		As of November 30, 2021	As of May 31, 2022
Liabilities
Current liabilities
Accounts payable - trade	211,852	243,128
Short-term loans payable	4,700,000	8,600,000
Current portion of long-term loans payable	1,713,041	2,490,314
Accounts payable - other	1,822,487	4,610,518
Accrued expenses	908,826	1,087,596
Income taxes payable	350,189	244,580
Unearned revenue	1,722,767	-
Contract liabilities	-	2,978,450
Provision for bonuses	34,506	139,041
Provision for bonuses for directors (and other	-	30,439
officers)
Provision for points	644	24,110
Provision for loss on order received	-	380
Other	812,054	827,549
Total current liabilities	12,276,371	21,276,108
Non-current liabilities
Long-term loans payable	2,141,100	4,789,314
Retirement benefit liability	2,376	2,789
Other	189,728	305,711
Total non-current liabilities	2,333,205	5,097,815
Total liabilities	14,609,576	26,373,924
Net assets
Shareholders' equity
Capital stock	25,775,494	26,250,753
Capital surplus	17,233,262	15,783,621
Retained earnings	(2,755,553)	(5,131,506)
Treasury shares	(850)	(1,018)
Total shareholders' equity	40,252,352	36,901,849
Accumulated other comprehensive income
Valuation difference on available-for-sale securities	228,409	533,862
Foreign currency translation adjustment	10,898	33,987
Total accumulated other comprehensive income	239,307	567,849
Share acquisition rights	38,529	35,078
Non-controlling interests	1,802,791	2,544,188
Total net assets	42,332,981	40,048,966
Total liabilities and net assets	56,942,558	66,422,891

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Consolidated Statements of Income (cumulative) and Consolidated Statements of Comprehensive Income (cumulative)

Consolidated Statements of Income (cumulative)

			(Thousands of yen)
		Six months ended	Six months ended
		May 31, 2021	May 31, 2022
Net sales		7,460,296	9,841,023
Cost of sales		2,077,343	3,479,301
Gross profit		5,382,952	6,361,721
Selling, general and administrative expenses		5,338,583	10,157,798
Operating profit (loss)		44,369	(3,796,076)
Non-operating income
Interest income		40	198
Dividend income		-	521
Consumption taxes refund		9,013	0
Gain on investments in investment partnerships		2,281	231
Other		5,311	3,612
Total non-operating income		16,646	4,563
Non-operating expenses
Interest expenses		22,217	33,391
Foreign exchange losses		6,063	26,137
Share of loss of entities accounted for using	equity	-	387
method
Loss on investments in investment partnerships		2,747	19,037
Other		1,451	4,719
Total non-operating expenses		32,478	83,673
Ordinary profit (loss)		28,536	(3,875,187)
Extraordinary income
Gain on reversal of share acquisition rights		1,210	966
Total extraordinary income		1,210	966
Profit (loss) before income taxes		29,747	(3,874,220)
Income taxes		35,401	126,249
Profit (loss)		(5,653)	(4,000,469)
Loss attributable to non-controlling interests		(26,064)	(112,725)
Profit (loss) attributable to owners of parent		20,410	(3,887,744)

Consolidated Statements of Comprehensive Income (cumulative)

		(Thousands of yen)
	Six months ended	Six months ended
	May 31, 2021	May 31, 2022
Profit (loss)	(5,653)	(4,000,469)
Other comprehensive income
Valuation difference on available-for-sale securities	22,380	305,453
Foreign currency translation adjustment	12,427	23,088
Total other comprehensive income	34,808	328,541
Comprehensive income	29,154	(3,671,927)
Comprehensive income attributable to
Comprehensive income attributable to owners of parent	55,218	(3,559,202)
Comprehensive income attributable to non-controlling	(26,064)	(112,725)
interests

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