Consolidated Financial Highlights for
Fiscal year ending March 31, 2022
Supplemental Materials

IMAGICA GROUP Inc.
Code：6879

May 13, 2022

Key points of financial results

１２Company-wide operating income before goodwill

amortization was 5.1bn yen, the highest since listing

Operating income before goodwill amortization turned
positive in all segments

Net income decreased by 700 million yen in part due to the３

impact of capital gains booked last year from the sale of a

subsidiary
Notes in this document (* 1-5) are on p18.

2

Financial results highlights
Sales declined due to sale of subsidiary, but both operating income and(Unit: million yen)operating income before goodwill amortization rose sharply
Net income attributable toparent company
shareholders

Net sales

Operating income before
goodwill amortization

Operating income (loss)

80,184

5,131

3,417

2,729

ChangeChangeChangeChange(6,543)94,090+4,811+4,501(725)

86,727

Capital gains from the sale of SDI
stock (4,936 million yen) werebooked with extraordinary income

80,184
5,131

3,454

3,417

2,729
2,456

1,351664

320(1,084)
FYE Mar.2020 FYE Mar.2021 FYE Mar.2022

FYE Mar.2020 FYE Mar.2021 FYE Mar.2022

FYE Mar.2020 FYE Mar.2021 FYE Mar.2022

FYE Mar.2020 FYE Mar.2021 FYE Mar.2022

3

Analysis of increase/decrease in sales (YoY)
Sales, excluding the sale of subsidiary SDI and the accounting standards change
impact, increased in all segments(Unit: million yen)

Production Services
Overall (4,892)
Production Services
Overseas (6,971)

12,666

86,727

1,864
Contentcreation

2,079
ProductionServices(domestic)

80,184(19,637)

1,473(4,839)

Imaging
Profit increasesystems
Accounting
from consolidation
standards
changeof Pixelogic
impactSales decrease fromremoval of SDI fromconsolidation

(147)
Other

FYE Mar.2022
ActualFYE Mar.2021
Actual(6,543)4

Analysis of increase/decrease in operating income
before goodwill amortization (YoY)
Production Services 4.2bn yen, Content Creation 1.0bn yen, Consolidated: 4.8bnyen income increase(Unit: million yen)

Production Services(Overall) +4,217
Production Services(overseas) +2,306
527(270)

1,779
Imagingsystems

1,911
Contentcreation

5,131

Consolidated
adjustments

Profit increase fromconsolidation ofPixelogic

1,028320

Income contribution
from removal of SDIfrom consolidation(164)

ProductionServices(domestic)FYE Mar.2021
ActualFYE Mar.2022
Actual+4,811
5

Content Creation
Profitability increased due to recovery of TV commercial production orders andstrong live music events: profits up 1bn yen year-on-year(Unit: million yen)

Net sales

Operating income before goodwillamortization
YoY

YoY

＋1,864 (+9.4%)＋1,027

26,20519,809FYE Mar.2020

FYE Mar.2021

587

21,674FYE Mar.2022

(359)

(440)

FYE Mar.2020

FYE Mar.2021

FYE Mar.2022

 Profitability of TV commercial production improved as orders recovered Solid sales thanks to movies, TV, animation, and dramas for video streaming service providers

 Strong orders for live music events thanks to online distribution as well as recovery of live events6

Production Services business
Sharp increase in profit due to ongoing strength in global E2E service *1 andstructural reform* 2
Operating income before goodwill
amortization

Net sales
YoY

46,973

Overseas
SDI

Overseas
SDI
PPC+4,217
3,399

42,080Overseas

Pixelogic
PPC

Overseas

718
Domestic

Domestic

Figures are sum ofdomestic and overseasYoY(4,892)
47,723(Unit: million yen)Domestic

Domestic

Domestic

Overseas(818)
FYE Mar.2020

FYE Mar.2021

FYE Mar.2022

FYE Mar.2020

FYE Mar.2021

FYE Mar.2022

 In Japan, services for video streaming service providers *3 remained strong. Digital cinema services

improved significantly due to an increase in movies released in theaters. Post-production was also strong.
Together with restructuring effects, profit increased sharply.

 Overseas, Pixelogic's localization for video streaming service providers continued to perform well. As movie
theaters reopened in the US and Europe, digital cinema service sales increased, and profits surged.
*Due to segment changes of subsidiaries, IMAGICA LIVE Co., Ltd. is added to the sales and operating income of the "Production Services Business" for FYE Mar.2020 andFYE Mar.2021.

7

Production Services (overseas) Quarterly results
A strong trend continued as sales and profits increased more than expected in 4Q
Operating income before goodwill
amortization

Net salesFYE Mar.2022(Unit: million yen)FYE Mar.2022

6,000
800

5,000600

4,000
3,000400

2,000200

1,00000△ 2001Q Actual

2Q Actual

3Q Actual

4Q Actual

1Q Actual

2Q Actual

3Q Actual

4Q Actual Services for video streaming service providers remained strong in 4Q (local: Oct-Dec)
 Digital cinema services were also strong as movie theater releases normalized in the US and Europe
8Imaging Systems & Solutions business
Sales increased by 1.4bn yen excluding the impact of change in accounting standards*4, but profit decreased as systems for broadcasting stations struggled
Net sales

YoY(3,367)

YoYExcluding impact of change in accounting standards+1,472

21,975(270)

21,0064,839

17,639FYE Mar.2020

FYE Mar.2021(Unit: million yen)

Operating income before goodwill
amortization

Accounting
standardimpact

FYE Mar.2022

2,758
2,046

FYE Mar.2020

FYE Mar.2021

1,776

FYE Mar.2022

 Domestic sales of high-speed cameras recovered from 2H, and sales in Asia, US, and Europe remained strong
 Sales of online delivery system for TV commercials *5 remained strong due to expanding market needs

 Sales of video/image processing LSI were strong in Japan and overseas (especially in Asia)
 Systems for broadcasting stations struggled due to sluggish demand and restrictions on sales activities*Impact of change in accounting standards: Impact of mobile communication line sales being booked as net figure*Due to segment changes of subsidiaries, IMAGICA LIVE Co., Ltd. is added to the sales and operating income of the "Imaging Systems & Solutions Business" for FYE
Mar.2020 and FYE Mar.2021.

9FYE Mar.2023: Full-year forecasts-Sales expected to increase 7.8bn yen, but operating income increase 180mn yen because ofhigher depreciation from investment in growth
Net income expected to decrease in part because last fiscal year corporate taxes declined due
to tax effect accounting
FYE Mar.2022(One million yen)

ActualFYE Mar.2023
Financial forecast

YoYchangeYoYchange80,18488,000

7,816

9.7%

5,131

5,200

69

1.3%

6.4%

5.9%

3,417

3,600

183

5.3%

4.3%

4.1%

Ordinary income

3,934

3,300(634)(16.1%)Net income attributable to parent company
shareholders

2,729

2,100(629)(23.0%)Net income per share (yen)

61.49

47.30

(14.19)(23.0%)Net sales

Operating income before goodwill
amortization(Profit margin)

Operating income(Profit margin)

10Year-end dividend forecast
Dividend policy
The Group considers the return of profits to shareholders as an important management objective.
Our basic policy is to distribute earnings in line with consolidated results. We target a consolidated
payout ratio of 30% and aim to maintain stable dividends while increasing their level.
If any special factor, such as an extraordinary gain or loss, significantly impacts the net income of agiven fiscal year, our general policy is to take the special factor into consideration in determining
dividends, after consideration of all aspects, including provision of stable dividends to shareholders,
future business development, and retained earnings.

Based on the above policy, the dividend forecast for FYE Mar.2023 is 15 yen.
Net income
Per share
attributable to parent Net income attributable
Dividend forecastcompany
to parent company
Net income
Net income

Expected for FYE
Mar.2023

2,100 mn yen

47.30 yen

15.0 yen

Dividend payout
ratio

31.7%
11

Appendix.

12

Consolidated Statements of Income
FYE Mar.2022

FYE Mar.2021(Unit: million yen)

ActualActualChangeYoY

Net sales

86,72780,184(6,543)(7.5%)

Gross profit

20,582

23,3862,803

13.60%

23.70%

29.20%(1,084)3,417

4,502--

4.30%(1,343)

3,934

5,278--

4.90%

Extraordinary income

7,138

1,301

(5,837)(81.8%)

Extraordinary losses

2,240

2,037(202)(9.1%)

Income before income taxes (loss)

3,554

3,198(356)(10.0%)

3,454

2,729(724)(21.0%)

320

5,131

4,811

1501.90%(Gross profit margin)

Operating income (loss)(Operating profit margin)

Ordinary income (loss)(Recurring profit margin)

Net profit attributable to shareholders of parentcompany(Reference) Operating income before goodwillamortization

Operating income before goodwill amortization = operating income + goodwill amortization + amortization of intangible fixed assets
including trademarks

13Consolidated Balance SheetsFYE Mar.2021

FYE Mar.2022

30,44041,066

10,6256,908

6,420(488)Non-current assets

30,00532,3172,312

Of which, goodwill

12,048

11,482(565)

Total Assets

60,44673,384

12,938Current liabilities

22,11732,278

10,161

Of which, short-term loans payable

7,402

4,170(3,232)

Non-current liabilities

8,495

7,079

(1,415)

Of which, long-term loans payable

5,384

4,019(1,365)

Total Liabilities

30,61339,358

8,745

Shareholders' equity

27,14929,963

2,814

301

1,185

883

11-(11)

2,370

2,876

505

Total Net Assets

29,832

34,025

4,192

Total Liabilities and Net Assets

60,44673,384

12,938(Unit: million yen)

Current assets
Of which, cash and deposits

AssetsLiabilities
Net Assets

Accumulated other comprehensive income
Stock acquisition rights
Non-controlling interests

YoY14Consolidated Statements of Cash Flow
4Q FYE Mar.2021

4Q FYE Mar.2022

Income before income taxes (loss)

3,554

3,198

Depreciation and amortization

2,757

2,059

871

1,406－(414)(4,936)

(417)

(52)

(1,992)

2,741(6,770)26

2,431

Increase/decrease in contract liabilities(1,635)

5,393

Income taxes paid

(1,868)

(389)

Other

(2,051)

2,911

(592)

7,414

(1,500)(3,996)

(709)

(612)

(Unit: million yen)Amortization of goodwill
Gain/loss on sales of investment securities
Gain/loss on sale of shares of subsidiaries and affiliatesIncrease/decrease in trade receivables and contract assets
Increase/decrease in inventory
Decrease (Increase) in notes and accounts payable-trade

Cash flow from operating activities
Purchase of property, plant and equipment
Purchase of intangible assets

5944

5,859

417

(23)

(546)

Other(4,995)(134)

Net cash used in investing activities

Income from the sale of investment securities
Proceeds from sale of shares of subsidiaries resulting in change in scope of consolidation
Expenditure by depositing security deposit and compensation(1,364)(3,928)Net increase (decrease) in short-term loans payable

3,596(2,023)

Proceeds from long-term loans payable

4,939

－

Repayment of long-term loans payable(4,048)(1,974)

Other(3,018)

(186)

1,469

(4,183)

2211

(485)

(486)

14

48

6,856

6,419

Cash flow from financing activities
Effect of exchange rate change on cash and cash equivalents
Increase/decrease in cash and cash equivalents
Increase/decrease in cash and cash equivalents resulting from change in scope of
consolidation
Cash and cash equivalents at end of period

15

Financial Results by Segment
FYE Mar.2021Actual(Unit: million yen)FYE Mar.2022
ActualYoY change% YoY

19,80921,674

1,864

9.40%

(440)

582

1,023--

2.70%(440)

587

1,028

-

Net sales

46,97342,080(4,892)(10.4%)

Production Services

Operating income (loss)(2,223)

1,726

3,949

-

business(Operating profit margin)

-

4.10%

(818)

3,399

4,217-

21,006

17,639(3,366)(16.0%)(305)(14.9%)Net sales
Content Creation

Operating income (loss)(Operating profit margin)

Operating income (loss) before goodwill amortization

Operating income (loss) before goodwill amortization
Net sales
Imaging Systems &Operating income

2,046

1,740

Solutions business(Operating profit margin)

9.70%

9.90%

2,046

1,776(270)(13.2%)(1,063)(1,211)(147)-(466)

(631)

(164)

-Net sales

86,72780,184(6,543)(7.5%)

Operating income (loss)(1,084)

3,417

4,502

-320

5,131

4,811

1501.90%

Operating income before goodwill amortization
Net sales

Other

operating loss

Consolidated total

Operating income before goodwill amortization

16*Due to segment changes of subsidiaries, , the FYE Mar.2021 figures for "Production Services business," "Imaging Systems," and "Other" have been changed.

Notes*1

Global E2E services
Refers to an integrated end-to-end (E2E) service that covers the entire post-production process forfeature films, TV dramas, animation, and other audio/video content up to media services for
localization (subtitling/dubbing) and distribution of these through all kinds of media, including
theaters, TV, and video streaming via the Internet.

*2

Structural reform
The structural reform discussed in this document refers to the voluntary retirement implemented in
the Production Services business segment to achieve sustainable growth and a rebound in financial
performance of the IMAGICA GROUP, as stated ”Notice of Establishment of New Subsidiaries,
Structural Reform of Production Services, and Group Business Reorganization” disclosed on January
22, 2021 (posted in English on February 9, 2021).

*3

Video streaming service providers
Refers to companies that provide video streaming services on a platform through the Internet.

*4Impact from a change in accounting standard
This refers to the impact from the change in accounting standard in the Imaging Systems & Solutions
business segment, which resulted in posting the net amount for mobile communication line sales.

*5Online delivery system for TV commercials
Refers to the service for online delivery of TV commercial source materials, etc. (service provided by
PHOTRON: C.M. HARBOR).
17

Contact for inquiries:
IMAGICA GROUP Inc.
Corporate Management Department

1-14-2 Kaigan, Minato-ku, Tokyo 105-0022, Japan
Email：ir@imagicagroup.co.jp
URL：https://www.imagicagroup.co.jp/en/
DISCLAIMER:

The forward-looking statements for the current and future business periods described in thisdocument are formulated based on the plans and prospects of the Group as of the date on whichthese materials were disclosed. Actual performance may differ from numerical forecasts due to theuncertainties inherent in the judgments and assumptions made, as well as possibility of futurechanges that may occur in business management and internal and external circumstances.
18