This document is a translation of the Japanese original. The Japanese original has been disclosed in Japan inaccordance with Japanese accounting standards and the Financial Instruments and Exchange Act. This
document does not contain or constitute any guarantee and the company will not compensate any losses
and/or damage stemming from actions taken based on this document. In the case that there is any discrepancy
between the Japanese original and this document, the Japanese original is assumed to be correct.

Consolidated financial results (Japanese Accounting Standards)
for the Second Quarter of the fiscal year ending March 31, 2024
Filing date: October 31, 2023
Company name:IMAGICA GROUP Inc.
Stock exchange listing: Tokyo Prime
Securities code:
6879
URL:
https://www.imagicagroup.co.jp/en/
Representative:
Nobuo Fuse, Representative Director, President
Tel: +81-3-5777-6295
Inquiries:
Masakazu Morita, Director and Senior Managing Executive Officer
Quarterly report filing date (as planned):
14 November, 2023
Dividend payment date (as planned):—
Supplemental material of quarterly results:
Yes
Convening briefing of quarterly results:
Yes(Millions of yen, rounded down)
1. Consolidated Financial Results for the Second Quarter of the fiscal year ending March 31, 2024
(April 1, 2023 – September 30, 2023)(1) Consolidated Operating Results
Net sales
6 months ended
Sept 30, 2023
6 months ended
Sept 30, 2022

(Percentage represents change from the same period of the previous fiscal year.)
Net income attributable
Operating income
Ordinary income
to owners of parent
Million yen%
Million yen%
Million yen%

Million yen%

46,68612.3

967(31.5)

938(29.8)

700(12.4)

41,589

22.9

1,411

227.0

1,336

33.7

799

(52.8)(Note) Comprehensive income:2nd quarter ended September 30, 2023: ¥2,113 million / (23.2)%
2nd quarter ended September 30, 2022: ¥2,750 million / 18.1%

Basic earnings
per share
6 months ended
Sept 30, 2023
6 months ended
Sept 30, 2022

Diluted earnings
per share

Yen

Yen

15.78

—

17.98

—

(2) Consolidated Financial Position
Total assets
As of Sept 30, 2023
As of March 31, 2023
(Reference) Shareholders’ equity:

Shareholders’equity ratio to total
assetsNet assets

Million yen

Million yen%

76,55681,88838,49640,30347.4
44.1

As of September 30, 2023:
As of March 31, 2023:¥36,257 million¥36,106 million

2. Dividends
1st quarter-end
Year ended March 31,2023
Year ending March 31,2024
Year ending March 31,2024(Forecast)

Dividend per share
2nd quarter3rd quarterend
end

Year-end

Annual

Yen

Yen

Yen

Yen

Yen

–
–

0.00
0.00

–

15.00

15.00

–

15.00

15.00

(Note) Changes in dividends forecast from the latest disclosed information: None

3. Consolidated forecast for the fiscal year ending March 31, 2024
(April 1, 2023 - March 31, 2024)(Percentage represents change from the same period of the previous fiscal year.)
Net income
Operating
Basic earnings
Net sales
Ordinary income
attributable toincomeper shareowners of parent
Full year

Million yen

100,000%

6.2

Million yen

4,000

%

3.4

Million yen

3,500

%

(3.8)

Million yen%

Yen

2,200 (43.1)

49.34(Note) Changes in earnings forecast from the latest disclosed information: None

* Notes:(1) Material changes in subsidiaries during this period (changes in scope of consolidations resulting from change insubsidiaries): None
(2) The application of specific accounting of the consolidated quarterly financial statements: Yes(3) Changes in accounting policies, accounting estimates and retrospective restatement
1) Changes in accounting policies based on revisions of accounting standards: None
2) Changes in accounting policies other than ones based on revisions of accounting standards: None
3) Changes in accounting estimates: None
4) Retrospective restatement: None
(4) Number of issued and outstanding shares (common stock)1) Number of issued and outstanding shares at the end of fiscal year (including treasury stock)
As of September 30, 2023
44,741,467 shares As of March 31, 2023
2) Number of treasury stock at the end of fiscal year
As of September 30, 2023
541,339 shares As of March 31, 2023
3) Average number of shares
As of September 30, 2023

44,397,288 shares As of September 30, 2022

44,741,467 shares

156,042 shares

44,469,282 shares* Consolidated quarterly financial results are exempted from quarterly review by a public certified accountant
or an auditing firm.
(Explanation regarding the appropriate usage of financial forecasts and other special instructions)
Forward-looking statements, such as financial forecasts, presented in this document are based on information
available and certain assumptions deemed to be reasonable to the company at the time of publication, and are not tobe read as guarantees of future performance by the company.

Table of Contents
1. Qualitative Information on Results in this Quarter ............................................................................... 2(1) Explanation of operating results ........................................................................................................ 2(2) Explanation of financial position ...................................................................................................... 4(3) Explanation of consolidated forecasts and other forward-looking information ................................ 4
2. Quarterly Consolidated Financial Statements ..................................................................................... 5(1) Quarterly Consolidated Balance Sheets ............................................................................................ 5(2) Quarterly Consolidated Statements of Income and Statements of Comprehensive Income ............. 7(3) Notes related to quarterly consolidated financial statements ............................................................ 9(Notes regarding ongoing concern assumption) ........................................................................... 9(Notes in the event of significant changes in shareholders’ equity) ............................................. 9(The application of specific accounting of the consolidated quarterly financial statements) ....... 9(Segment information and others) .............................................................................................. 10

1

1. Qualitative Information on Results in this Quarter(1) Explanation of operating results① Overview of the second quarter of the consolidated fiscal year ending March 31, 2024
In the second quarter of the consolidated fiscal year, although the Japanese economy showed signs ofrecovery, the outlook remains uncertain due to soaring prices and manifestation of geopolitical risks caused by
the situation in the Middle East and Ukraine.
As we enter the third year of our G-EST 2025 Mid-Term Plan set in FY2021, the group has reaffirmedthat improvement of profitability is an important issue to realize our vision of becoming a “highly profitablegroup” in FY2025. Accordingly, the group has revised its four key strategies and has added “Expansion ofgame-related business” as a new strategy. In FY2023, we will tackle to achieve net sales of 110 billion yen,operating margin of 8% before goodwill and other amortization, and EBITDA of 11 billion yen in FY2025,
following our policy “FY2023 is the year to get on growth path after establishment of basis for growth.”
Under these circumstances, the group’s performance in the second quarter of the consolidated fiscal year
was as follows: Net sales were 46,686 million yen (up 12.3% year on year), operating income was 967 million
yen (down 31.5%), ordinary income was 938 million yen (down 29.8%), and net income attributable to ownersof the parent was 700 million yen (down 12.4%).
② Performance by business segment
Financial results by business segment are as follows.
Effective from the first quarter of the consolidated fiscal year, the name of the reportable segment“Production Services business” has been changed to “Production Technology Services business.” This
represents a change in segment name only and has no impact on the segment information.
1) Content Creation businessIn the second quarter of the consolidated fiscal year, the segment reported sales of 12,770 million yen (up41.2% year on year) and operating income of 89 million yen (up 90.3%).
Sales of feature films and dramas significantly increased owing to the feature film “Godzilla Minus One”
to be released on November 3, the Netflix feature film “Zombie 100: Bucket List of the Dead.” and otherworks. Sales of animation works increased owing to steady orders for TV series. Sales of the publishingbusiness increased due in part to strong sales of the light novel “The Apothecary Diaries,” whose TV animatedseries started in October. On the other hand, sales of commercial production decreased due to sluggish
performance in TV commercials, although there were a high number of orders for web commercials.
As a result, sales and operating income increased in the segment.
2) Production Technology Services businessIn the second quarter of the consolidated fiscal year, the segment reported sales of 26,913 million yen (up5.1% year on year) and operating income of 793 million yen (down 33.5%).
In domestic E2E services*1, sales increased owing to solid sales of digital cinema services andlocalization, etc. In overseas E2E services*1, while sales increased in digital cinema services and trailer
production service supported by increase of new theatrical releases, operating income decreased due to a rise in
fixed costs brought on by growth investments. In the game-related business*2, among other factors, sales
increased owing to 30% growth in Game 3DCG production. In post-production services for TV, sales andoperating income declined due to weak orders.
As a result, sales increased, however operating income decreased in the segment.
*1 E2E services: End-to-end services. This is a general term for one-stop services ranging from postproduction in the production of video content such as movies, dramas, and animation to media services for the
localization (dubbing and subtitling) and distribution required for the distribution of said content throughmovie theaters, TV, and the Internet. Please note as the closing date for overseas E2E services is December 31,
the results from January 1, 2023 to June 30, 2023 were reflected in the second quarter of the consolidated fiscal
2year.
*2 Game-related business: 2D/3DCG production, debugging and software testing, creative talent dispatch
and referral, etc. for games
3) Imaging Systems & Solutions businessIn the second quarter of the consolidated fiscal year, the segment reported sales of 8,094 million yen(down 1.4% year on year) and operating income of 671 million yen (down 5.7%).
Sales of high-speed cameras significantly increased owing to recovery in production by settlement ofsemiconductor shortage and strong orders. On the other hand, sales of the broadcast imaging systems &solutions business decreased as it had sales of large projects in the previous year. Sales in optical measurementbusiness and video and image processing LSIs declined due to deteriorating market environments and otherfactors.
As a result, sales and operating income decreased in the segment.

3(2) Explanation of financial position① Assets
Current assets decreased by 5,665 million yen (12.6%) from the end of the previous consolidated fiscal
year to 39,305 million yen. This was mainly due to decreases in notes, accounts receivable - trade, and contract
assets and in cash and deposits.
Non-current assets increased by 333 million yen (0.9%) from the end of the previous consolidated fiscal
year to 37,250 million yen. This was mainly due to increases in buildings and structures, in “other” in property,
plant and equipment, and in goodwill which had impact of exchange rate, while construction in progressdecreased.
As a result, total assets decreased by 5,331 million yen (6.5%) from the end of the previous consolidated
fiscal year to 76,556 million yen.
② Liabilities
Current liabilities decreased by 3,104 million yen (9.3%) from the end of the previous consolidated fiscal
year to 30,100 million yen. This was mainly due to decreases in notes and accounts payable - trade and incontract liabilities.
Non-current liabilities decreased by 420 million yen (5.0%) from the end of the previous consolidated
fiscal year to 7,958 million yen. This was mainly due to a decrease in long-term borrowings.
As a result, total liabilities decreased by 3,524 million yen (8.5%) from the end of the previous
consolidated fiscal year to 38,059 million yen.
③ Net assets
Net assets decreased by 1,807 million yen (4.5%) from the end of the previous consolidated fiscal year to38,496 million yen. This was mainly due to a decrease in non-controlling interests.

(3) Explanation of consolidated forecasts and other forward-looking information
There are no revisions to the full-year forecasts for the consolidated fiscal year ending March 31, 2024,
from the forecasts announced on May 11, 2023.

4

2. Quarterly Consolidated Financial Statements(1) Quarterly Consolidated Balance Sheets(Thousands of yen)March 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade, andcontract assets
Inventories
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation
Accumulated impairment
Buildings and structures, net
Machinery, equipment and vehicles
Accumulated depreciation
Accumulated impairment
Machinery, equipment and vehicles, net
Land
Leased assets
Accumulated depreciation
Accumulated impairment
Leased assets, net
Construction in progress
Other
Accumulated depreciation
Accumulated impairment
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Shares of subsidiaries and affiliates
Leasehold and guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

5

September 30, 2023

7,813,769

4,868,248

21,937,480

18,119,251

12,460,112
2,868,953(109,328)
44,970,987

12,621,406
3,803,332(106,609)
39,305,629

12,213,112(7,584,337)(619,501)
4,009,273
6,210,738(5,525,748)(139,607)
545,383
921,3635,991,152(871,877)(121,127)
4,998,147
1,711,600
7,801,738(5,377,680)(135,685)
2,288,372
14,474,140

12,823,455(7,888,933)(612,947)
4,321,573
6,265,251(5,574,998)(138,839)
551,413921,363
6,199,703(949,083)(119,309)
5,131,310
1,223,766
8,788,964(5,982,456)(143,568)
2,662,939
14,812,366

11,780,285
2,460,007
14,240,292

11,999,408
2,599,118
14,598,527

2,876,524
514,0422,048,952
2,420,133
490,206(147,088)
8,202,771
36,917,204
81,888,191

2,833,722
497,171
2,053,219
2,195,630
419,754(159,774)
7,839,724
37,250,619
76,556,248

(Thousands of yen)March 31, 2023
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Lease liabilities
Accounts payable
Income taxes payable
Contract liabilities
Provision for bonuses
Provision for loss on orders received
Provision for loss on litigation
Asset retirement obligations
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Lease liabilities
Long-term accounts payable
Deferred tax liabilities
Retirement benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive
incomeNon-controlling interests
Total net assets
Total liabilities and net assets

6

September 30, 2023

7,133,738
6,432,680
881,977
1,769,403
1,172,785
7,591,449
1,281,691
1,100
630,660
23,181
6,286,605
33,205,274

5,592,806
6,686,286
961,325
1,867,424
530,040
6,259,951
891,046
2,200——
7,309,525
30,100,606

1,366,665
4,498,102
252,767
196,598
1,241,071
653,518
170,257
8,378,982
41,584,257

913,458
4,644,918
156,543
212,691
1,256,118
663,773
111,284
7,958,788
38,059,394

3,306,002
13,020,018
16,982,736(158,530)
33,150,226

3,306,002
12,155,677
17,013,879(411,349)
32,064,210

713,553
20,740(17,933)
2,237,081
2,828

846,113
38,582(17,933)
3,324,225
2,191

2,956,270
4,197,436
40,303,934
81,888,191

4,193,179
2,239,463
38,496,854
76,556,248

(2) Quarterly Consolidated Statements of Income and Statements of Comprehensive Income
Quarterly Consolidated Statements of Income(Thousands of yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Other
Total non-operating income
Non-operating expenses
Interest expenses
Equity in losses of affiliates
Administrative expenses for investment
partnerships
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Reversal of provision for loss on litigation
Compensation for forced relocation
Other
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Impairment losses
Office transfer related expenses
Extra retirement payments
Other
Total extraordinary losses
Net incone before income taxes
Income taxes
Net incone
Net income attributable to non-controlling interests
Net income attributable to owners of parent

7

6 months ended
September 30, 2022
41,589,200
29,497,045
12,092,154
10,680,221
1,411,932

6 months ended
September 30, 2023
46,686,164
33,821,236
12,864,927
11,897,303
967,624640
16,712
46,13390,049153,536

4,933
23,914
225,834
78,460333,143

113,758524

182,644
9,071—

96,567

114,350
228,632
1,336,836

74,360362,644938,123

7,001
28,000—277,370
6,168
318,540252
290,067
234,162——
524,482

1,894
9,048
50,263
170,228
3,272
234,7071,420,669
548,238
872,430
72,780799,650

1,283
15,430———16,714
1,445,891
569,768
876,123
175,695
700,427

Quarterly Consolidated Statements of Comprehensive Income(Thousands of yen)

Net income
Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net oftax
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests

8

6 months ended
September 30, 2022
872,430

6 months ended
September 30, 2023
876,123(36,838)

136,875—
1,915,588

17,842
1,083,612

(330)

(637)

1,878,418
2,750,849

1,237,693
2,113,816

2,661,138

1,937,336

89,711

176,480

(3) Notes related to quarterly consolidated financial statements(Notes regarding ongoing concern assumption)
No relevant matters to be noted.
(Notes in the event of significant changes in shareholders’ equity)
No relevant matters to be noted.
(The application of specific accounting of the consolidated quarterly financial statements)(Calculation of tax expenses)
Tax expenses are calculated by rationally estimating the effective tax rate after applying tax effectaccounting to net income before income taxes for the consolidated fiscal year that includes the current second
quarter and multiplying net income before income taxes for the quarter by the estimated effective tax rate.
However, if the calculation of tax expenses using this estimated effective tax rate leads to obviously
irrational results, the statutory effective tax rate is used after adjusting income/loss before income taxes formaterial differences that do not fall under temporary differences.

9

(Segment information and others)[Segment information]
I.

For the 6 months ended September 30, 2022 (from April 1, 2022 to September 30, 2022)
1. Information regarding net sales and income (loss) by reportable segment(Thousands of yen)

Net sales
Sales to external customers
Inter-segment sales ortransfers
Total
Segment income

Content
Creation

Production
Technology
Services

Imaging
Systems &Solutions

Sub total

Adjustments(Note 1)

Amount in the
Quarterly
Consolidated
Statements ofIncome(Note 2)

9,029,270

24,727,181

7,823,188

41,579,640

9,559

41,589,200

16,549868,927

389,104

1,274,581(1,274,581)—

9,045,820
46,87025,596,109
1,192,524

8,212,292
712,740

42,854,222
1,952,135(1,265,022)(540,202)

41,589,200
1,411,932(Notes) 1. Adjustment of segment income of (540,202) thousand yen consists of income/loss related to the company
of 1,365,953 thousand yen and elimination of inter-segment transactions of (1,906,156) thousand yen.
2. Segment income is adjusted against operating income on the quarterly consolidated financial statements.

10

II.

For the 6 months ended September 30, 2023 (from April 1, 2023 to September 30, 2023)
1. Information regarding net sales and income (loss) by reportable segment(Thousands of yen)

Net sales
Sales to external customers
Inter-segment sales ortransfers
Total
Segment income

Content
Creation

Production
Technology
Services

Imaging
Systems &Solutions

Sub total

Adjustments(Note 1)

Amount in the
Quarterly
Consolidated
Statements ofIncome(Note 2)

12,729,065

26,245,479

7,707,197

46,681,742

4,421

46,686,164

41,332

668,366

387,695

1,097,393(1,097,393)—

12,770,397
89,192

26,913,845
793,5938,094,892
671,926

47,779,136
1,554,713(1,092,971)(587,088)

46,686,164
967,624(Notes) 1. Adjustment of segment income of (587,088) thousand yen consists of income/loss related to the company
of 1,037,966 thousand yen and elimination of inter-segment transactions of (1,625,055) thousand yen.
2. Segment income is adjusted against operating income on the quarterly consolidated financial statements.

2. Information regarding changes in reportable segments
Effective from the first quarter of the consolidated fiscal year, the name of the reportable segment“Production Services business” has been changed to “Production Technology Services business.” This
represents a change in segment name only and has no impact on the segment information.
The segment Information for the second quarter of the previous fiscal year is presented with the new
segment name.

11