Consolidated Financial Highlights for
the Third Quarter of the fiscal year ending
March 31, 2022
Supplemental Materials

IMAGICA GROUP Inc.
Code：6879

February 4, 2022

Third Quarter Results Highlights

１

Total operating income before goodwill amortization* for the company was ３.2 billion yen, an increase of 4.7 billion yen versus the 3Q of FYE March 2021,
and an increase of 2.0 billion yen from FYE March 2020 (pre-COVID-19).

２

Production Services was the engine driving improvement in profit, recording
a 3.8 billion yen increase in OIBDA versus the 3Q of FYE March 2021.

３

Content Creation also saw a rebound in orders. This resulted in
improvement in OIBDA of 0.7 billion yen versus the 3Q of FYE March 2021.
* Operating income before goodwill amortization: Abbreviated to “OIBDA”(operating income before depreciation and amortization) hereafter.
Notes (*1-*5) are on page 19 of these materials.

2

Highlights of Financial Results for the First Three Quarters
・Net sales declined due to the sale of SDI, but profit at all levels substantially outperformed
FYE March 2020 (pre-COVID-19).
(Million Yen)

Net sales

OIBDA

Operating income(loss)Net profit (loss)
attributable to ownersof the parent

55,618

3,210

1,938

2,460

YoY

YoY

YoY

YoY

(3,052)+4,774+4,307+3,123

3,210

67,40558,670

2,460

1,938
55,618

1,186

815

357

(663)
(1,564)(2,369)3Q
3Q
3Q
FYE Mar. 2020 FYE Mar. 2021 FYE Mar. 2022

3Q
3Q
3Q
FYE Mar. 2020 FYE Mar. 2021 FYE Mar. 2022

3Q
3Q
3Q
FYE Mar. 2020 FYE Mar. 2021 FYE Mar. 2022

3Q
3Q
3Q
FYE Mar. 2020 FYE Mar. 2021 FYE Mar. 2022

3

Contributing Factors to Increases (Decreases) in Net Sales(vs 3Q FYE March 2021)
・All business segments achieved growth in net sales when the decrease due to thesale of SDI is excluded.
Production Services(Overall: (2,007))(Million Yen)

10,30658,670

1,395

2,064
(14,378)

Content
Creation

Production
Services(Domestic)

55,618

1,263

Production Services(International)

Sale of SDI

Imaging
Systems &Solutions(3,443)(259)

Impact fromAccountingStandard

Other

Production Services(International: (4,072))

3Q FYE
Mar. 2021
Actual3Q FYE
Mar. 2022
Actual(3,052)
4

Contributing Factors to Increases (Decreases) in OIBDA (vs 3Q
FYE March 2021)
・ OIBDA increased substantially to 4.7 billion yen on a consolidated basis. Production
Services was responsible for 3.8 billion yen of the increase, and Content Creation, for
700 million yen.
(Million Yen)

Production Services(Overall: +3,894)
Production Services(International)+1,724

650
1,074

(38)
Imaging Systems& Solutions

2,169

3,210

175

Sale of SDI

Consolidated
Adjustments

Production Services(International)(1,564)743

Production Services(Domestic)Content
Creation

3Q FYE
Mar. 2021
Actual3Q FYE
Mar. 2022
Actual+4,7755

Content Creation (First Three Quarters)
・Net sales rebounded substantially owing to a rebound in orders, increasing by 300
million yen from FYE March 2020.
(Million Yen)OIBDANet sales
YoY

YoY+1,395(+10.0％)+743

20,03813,88815,284

181

(203)
(562)

3Q
FYE Mar. 2020

3Q
FYE Mar. 2021

3Q
FYE Mar. 2022

3Q
FYE Mar. 2020

3Q
FYE Mar. 2021

3Q
FYE Mar. 2022

✔ The rebound in orders for TV commercial production continued and profitability also improved.
✔ Sales were firm, partially due to the delivery of TV dramas to video streaming service providers, despite
postponement in delivery of some feature films to the 4Q.

✔ Orders for online streaming of live music performances and shooting music videos were also strong.
6

Production Services (First Three Quarters)
・Strong growth in OIBDA resulted mainly from strong sales of global E2E services*1 anddomestic structural reform*2.
(Million Yen)OIBDANet sales
YoY

YoY(2,007)+3,89434,517

SDI

29,776
Domestic

International

SDI
PPC

International

Pixelogic
PPC

186
Domestic
International

Domestic

2,358International

31,784
International(Numbers show thesum of domestic plus
international.)

Domestic

Domestic

Domes
tic

(1,535)3Q
FYE Mar. 2020

3Q
FYE Mar. 2021

3Q
FYE Mar. 2022

3Q
FYE Mar. 2020

3Q
FYE Mar. 2021

3Q
FYE Mar. 2022

✔ In the domestic market, services for video streaming service providers*3 remained strong. An increase in the numberof feature films also led to a rebound in digital cinema services, and post-production services were also firm. In
addition to strong sales, benefits derived from structural reform boosted OIBDA substantially.

✔ In the international market, Pixelogic’s localization business for video streaming service providers remained strong.
OIBDA improved substantially, due in part to a rebound in sales of digital cinema services accompanying theresumption of theater operation in Europe and the U.S.
7*

IMAGICA LIVE Corp. performance was excluded from net sales and operating income (loss) for Production Services in FYE March 2020 and FYE March 2021 due tothe reclassification of the subsidiary into another segment.

Production Services (International)
Quarterly Consolidated Performance Forecast
・3Q results exceeded the forecast.
・ Theaters in Europe and the U.S. will continue to resume operation in the 4Q, resulting in(Million Yen)
substantial improvement in net sales and OIBDA.
Net salesOIBDA
FYE Mar. 2022

FYE Mar. 2022

6,000

800

5,000

600

4,000
3,000

400

2,000

200

1,000

0

0

(200)
1Q Actual

2Q Actual

3Q Actual

4Q

Forecast

1Q Actual

2Q Actual

3Q Actual

4Q

Forecast✔ Services for video streaming service providers are also expected to be strong from the 4Q onward.
✔ The resumption of theater operation in Europe and U.S. in the 3Q (July through September locally), resulted
in substantial improvement in OIBDA, as anticipated.
8

Imaging Systems & Solutions (First Three Quarters)
・Net sales increased by 1.2 billion yen, if the impact from the change in accounting
standard*4 is excluded.
(Million Yen)OIBDANet sales
YoY(2,180)

YoY+175

Excluding the impact fromaccounting standard: 1,263

13,984

13,962

3,443

11,7823Q
FYE Mar. 2020

3Q
FYE Mar. 2021

3Q
FYE Mar. 2022

Change inaccounting
standard

1,575

3Q
FYE Mar. 2020

874

1,050

3Q
FYE Mar. 2021

3Q
FYE Mar. 2022

✔ Sales of high-speed cameras showed a trend of rebound in Japan and remained strong in Asia and the
U.S./Europe.
✔ Sales of the online delivery system for TV commercials*5 remained strong due to expansion in market
needs.
✔ Sales of video and image processing LSI were strong in both the domestic and international markets.
✔ Sales of systems for broadcasting stations were slow compared to FYE March 2020, mainly due to a slump
in demand.
9＊ Impact from a change in accounting standard: Impact from posting the net amount for mobile communication line sales.
＊ IMAGICA LIVE Corp. performance was added to Imaging Systems & Solutions net sales and operating income (loss) in FYE March, 2020 and FYE March, 2021 due tothe reclassification of the subsidiary into the Imaging Systems & Solutions segment.

Consolidated Forecasts for FYE March 31, 2022
・We expect the Omicron variant and other factors to have an impact on financial results
and have therefore left the forecasts unchanged at present.
FYE Mar. 2021

FYE Mar. 2022

(Million Yen)

Forecast disclosed on
December 24, 2021

ActualYoY% YoY

Net sales

86,72777,000(9,727)(11.2%)

Operating income (loss)(1,084)

2,000

3,084

－

(%)

(2.6%)－－(1,343)

2,500

3,843

－

Net income (loss)
attributable to owners of parent

3,454

2,500

(954)

(27.6%)

Earnings (loss) per share (Yen)

77.89

56.32

(21.57)(27.6%)

320

3,610

3,290

1,028%(Operating margin)

Ordinary income (loss)

OIBDA

10

Appendix

11

Consolidated Statements of Income
3Q
FYE Mar. 2021

(Million Yen)

3Q
FYE Mar. 2022

ActualActualYoY% YoY(Million Yen)

58,67055,618(3,052)(5.2%)

Gross profit

12,932

16,390

3,458

26.7%

22.0%

29.5%

(2,369)

1,938

4,308

ー

ー

3.5%

(2,729)

2,448

5,178

ー

ー

4.4%

Extraordinary income

2,216

858

(1,357)(61.3%)

Extraordinary losses

154

559

405

262.1%Net income (loss) before income tax

(667)

2,747

3,415

ー

Net profit (loss) attributable to owners ofparent

(663)

2,460

3,123

ー

(1,564)

3,210

4,775

ー

(Gross margin)

Operating income (loss)(Operating margin)

Ordinary income (loss)(Ordinary margin)(Reference) OIBDA* OIBDA includes: Operating income, goodwill amortization, and amortization of intangible assets including trademarks.

12Consolidated Balance Sheets(Million Yen)

Current assets

As ofMar. 31, 2021

As ofDec. 31, 2021

YoY

Main Factors
6,373 Cash and deposits: (893)

30,44036,814

Cash and deposits

6,908

6,014

Notes and accounts receivable-trade andcontract assets: +875(893) Inventories: +6,221

Ass
ets Non-current assets

30,00532,6982,692 Buildings and structures +2,217

Goodwill

12,04812,134

Total Assets

60,446

69,512

9,066

Current liabilities

22,11728,782

6,664 Notes and accounts payable-trade: +1,163

7,402

5,520

(1,882) Contract liabilities +5,093

8,495

7,497

(998)

5,384

4,297

(1,087)

Investment securities: (750)85 Shares of subsidiaries and affiliates: (638)

Accounts payable: +1,648
Short-term loans payableNon-current liabilities
Long-term loans payableLiabiliti Total Liabilitieses /Shareholders’ equity
Net
Ass Accumulated otherets comprehensive income

30,61336,2795,666

27,14929,691

2,541 (Reference) Equity capital

301

732

430 As of March 31, 2021: 27,450 (45.4%)

Stock acquisition rights11ー(11) As of December 31, 2021: 30,423 (43.8%)

Non-controlling interests

2,370

2,809

438

Total Net Assets

29,832

33,232

3,399

Total Liabilities and Net Assets

60,446

69,512

9,066

Net cash(5,878)(3,803)

2,075 term loans payable)(Cash and deposits － long-term and short-13

Financial Results by Segment
3Q
FYE Mar. 2021

(Million Yen)

Actual

10.0%

(562)

177

740

ー

ー

1.2%

(562)

181

743

ー

Net sales

31,78429,766(2,007)(6.3%)

Operating income (loss)(2,340)

1,116

3,457

ー

ー

3.8%

OIBDA

(1,535)

2,358

3,894

ー

Net sales

13,962

11,782(2,180)(15.6%)

Operating income

874

1,023

148

17.0%

(Operating margin)

6.3%

8.7%

OIBDA

874

1,050

175

20.1%

Net sales(965)(1,225)(259)

ーOperating loss

(340)

(379)

(38)

ー

Net sales

58,67055,618(3,052)(5.2%)

Operating income (loss)(2,369)

1,938

4,308

ー

－

3.5%

(1,564)

3,210

4,775

ー

(Operating margin)(Operating margin)

OthersConsolidated total

% YoY

1,395

OIBDA

Imaging Systems &Solutions

YoY

15,284

Operating income (loss)

Production Services

Actual

13,888Net sales

Content Creation

3Q
FYE Mar. 2022

(Operating margin)

OIBDA* The figures for Production Services, Imaging Systems and Solutions, and Others have changed due to reclassification of subsidiaries into different segments in the 3Q of FYEMarch 2021.

14

(Reference)
Change in Overseas Subsidiaries in Production Services✔ The P/L of Pixelogic, which provides E2E service*1, was consolidated from thefourth quarter of FYE March 2021.
✔ All shares held in SDI were sold at the end of March 2021, removing it from thescope of consolidation.

Fiscal Year

Company Name

1Q

2Q

3Q

4Q

Consolidated through the 4Q of FYE Mar. 2021

SDI
FYE Mar. 2021

Pixelogic

P/L consolidated from the 4Q of FYE Mar. 2021

Full-year consolidation in FYE Mar. 2022

FYE Mar. 2022

Pixelogic＊ Pixelogic has a fiscal year-end of December 31. The financial performance during the 3Q of FYE March 2022 therefore
reflects the results for January 1 through September 31, 2021.
15

(Reference)
Disclosure of OIBDA
We have disclosed OIBDA as a key indicator from the first quarter of FYE March2022 onward to appropriately reflect the actual status of the IMAGICA GROUP.

(単位：百万円)

FYE Mar.2022
３Q

FYE Mar.2022
Full year

Mew Mid-Term Plan
“G-EST2025”

ActualPlan

Goal

55,61875,000Operating income

1,938

2,000

OIBDA

3,210

3,610

Net sales

100,000

8,000

OIBDA includes: Operating income, goodwill amortization, and amortization of
intangible fixed assets accompanying M&A.
16

(Reference)
Request for Prime Market Selection
・We have requested Prime Market selection and have submitted a written plan for meetingthe continued listing requirements.
・Listing Requirement Fulfillment Status
Prime Market
Listing Criteria

Fulfillment Status

IMAGICA GROUP Numbers(Base date: June 30, 2021)

No. of Tradable Shares

At least 20,000 unitsMet

122,002 units

Tradable Share Market Cap

At least JPY 10 billion

Will improve

JPY 6.12 billion

At least 35.0%

Will improve27.2%

Tradable Share Ratio
Ave. Daily Trading ValueAt least JPY 20 million

Met

JPY 41 million

・Basic Policy and Initiatives Aimed at Improvement
1.Increase market capitalization
We will strive to achieve the goal of being “Group with a balanced, highly profitable structure that is resilient even under adverse
circumstances” stated in Mid-Term Plan "G-EST 2025,“ and will continually work to increase market capitalization by strengthening IR
activities and promoting dialog with shareholders and investors in other ways.

2.Increase tradable share ratio
We will engage in dialog with major shareholders and corporate shareholders on increasing the tradable share ratio and will implement
other measures that will contribute to increasing liquidity.

17

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.
*4 Impact 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.
*5

Online 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).
18

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.
19