MTI : Financial Results Presentation for Q2 FY2024

Financial Results Briefing

Material for Q2 FY2024

*The revisions to the consolidated forecast for the second quarter (cumulative) and full year, announced on February 9th, are reflected in these figures.

May 10, 2024

Securities Code︓9438

This report contains forward-looking statements on business performance based on the judgments, assumptions, and beliefs of management using the information available at the time. Actual results may differ materially due to changes in domestic or overseas economic conditions or changes in internal or external business environments or aspects of uncertainty contained in the forecasts, latent risks or various other factors. In addition, risk and uncertainty factors include unpredictable elements that could arise from future events.

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Contents

Financial Results Overview

for Q2 FY2024

… P2

Financial highlight Consolidated P/L Consolidated SG&A

Difference between earning forecast and the actual for H1 Revision of First-Half and Full-Year earning forecasts Performance by segment

Approach in Q3 and beyond … P19

Basic policies and priority issues for FY2024 Cloud drug record service

Maternal health record book app + Childcare DX services School DX business

Image of medium-term profit … P31

Appendix …P34

Consolidated B/S

Consolidated P/L

Consolidated SG&A Business of segment Earnings forecast for FY2024

The list of main healthcare services Overview of healthcare services Cloud drug record service

Maternal health record book app + Childcare DX services School DX business

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Financial Results Overview for Q2 FY2024

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Financial highlight

１ Q2 Results

Net sales and income were both higher than the forecast.	YoY
Net sales︓	¥13,517 million	(113) million
Operating income︓	¥1,052 million	+1,071 million
Profit attributable to	¥1,558 million	+1,884 million
owners of parent︓
2 Revision of Full-year earning forecast upward	earning forecast
		First-Half
Net sales︓	¥27,000 million	Maintained
Operating income︓	¥1,800 million	+800 million
Profit attributable to	¥1,750 million	+410 million
owners of parent︓

• Q2 Achievements and initiatives

Change from the most recent forecast

+517 million

+452 million

+318 million

・Healthcare business︓Cloud drug record service and Childcare DX services performing well ・School DX business︓ The number of schools introduced in April 2024 was 255

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Consolidated P/L

Net sales : levelling off

Operating income, ordinary income, profit : substantial increased

• Unit︓Mil yen ）

Net sales

Cost of sales

ratio

Gross profit

ratio

SG&A

ratio

Operating income

ratio

Ordinary income

ratio

Profit attributable to owners of parent

ratio

FY2023

Q2

13,631

4,481

32.9%

9,150

67.1%

9,168

67.2%

(18)

-%

187

(1.4)%

(326)

-%

YoY

Amount Percentage

(113) (0.8)%

(868) (19.4)%

+755 +8.3%

	(315)			(3.4)%

+1,071	-%
+1,331	+711.3%
+1,884	-%

The same period of previous year:

739million Yen: Posting of spot sales of the video-streaming service

• Loss-makingprojects in the DX support business for companies have wound

down

・The same period of previous year: 649million Yen :Posting of spot cost of sales of the video-streaming service

Decrease in personnel and development costs

Increase in equity method investment income (+335million yen)

Consumption taxes refund (+786 million yen)

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Consolidated SG&A

Advertising expenses: increased

Personnel expenses: exclusion of subsidiary from consolidation

Development costs: improved development costs for the school DX business

		FY2023
（ Unit︓Mil yen ）	Q2
SG&A		9,168
Advertising expenses		1,016
Personnel expenses		3,947
Commission fee		1,491
Subcontract expenses		1,059
Depreciation		591
Other		1,062

YoY

Amount Percentage

1. (3.4)%
   +284 +28.0%

1. (9.0)%

1. (5.1)%

	(150)			(14.2)%
+61			+10.4%
(81)			(7.7)%

Increase in sales promotion costs for AdGuard

Exclusion of subsidiaries from consolidation

Improved development costs (School DX business)

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Difference between earning forecast and the actual for H1

All exceeded expectations

		FY2024
		First-Half
（ Unit︓Mil yen ）	（latest forecast）
Net sales		13,000
Operating income		600
Ordinary income		1,000
Profit attributable to		1,240
owners of parent

Difference

(million yen)		（%）

+517 4.0%

+452 +75.4%

+518 +51.8%

+318 +25.7%

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Revision of earning forecast of FY2024

Operating income, ordinary income and profit for the period have been revised upward

		FY2024
		Full-Year
（ Unit︓Mil yen ）	（latest forecast）
Net sales		27,000
Operating income		1,000
Ordinary income		1,400
Profit attributable to		1,340
owners of parent

Difference

(million yen)		（%）

--

+800 +80.0%

+850 +60.7%

+410 +30.6%

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Performance by segment

Content

Business

・Content service

(Entertainment & Life content)

・Original comics service

Healthcare

Business

・Healthcare service for women

・Childcare DX service

・Cloud drug record service ・Online consultation service, etc.

School DX	Other
Business	Business
・School DX service	・AI business
・DX support business
	for companies
	・Solution service for
	corporate

Securitycomic

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Content business : Net sales and operating income

（Unit︓Mil yen）

			5,100	5,118
4,639	4,436	4,342	※1	※24,384	4,317	4,289	4,210	4,216

2,014 1,534 1,322 1,328 ※1 1,439 1,355 1,210 1,218 1,091 1,169

QoQ

Levelled off net sales

The number of paying subscribers remained almost unchanged.

QoQ

Levelled off operating income

Increased in advertising expenses

Special factors

*1︓Net sales & Operating income 717 million yen:

1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q
	FY2022			FY2023
			Net sales	Operating income

1Q 2Q

FY2024

Change in treatment of consumption tax in monthly content services that award points.

*2︓Net sales 739 million yen:

Posting of spot sales of the video-streaming service.

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