Financial Results Briefing
Material for Q1/2024*The revisions to the consolidated forecast for the second quarter (cumulative)
and full year, announced on February 9th, are reflected in these figures.

February 8, 2024
Securities Code：9438
This report contains forward-looking statements on businessperformance 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 orexternal business environments or aspects of uncertainty
contained in the forecasts, latent risks or various other factors.
In addition, risk and uncertainty factors include unpredictableelements that could arise from future events.

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2024 MTI Ltd. All Right Reserved

Contents
Financial Results Overview
for Q1 FY2024… P2

Image of medium-term profit … P28

Financial highlight
Consolidated P/LConsolidated SG&A
Revision of First-Half and Full-Year earning forecasts(*The revisions announced on February 9th have been reflected)

Performance by segment

Approach in Q2 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

Appendix …P31
Consolidated B/SConsolidated P/LConsolidated 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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1Financial Results Overview for Q1 FY2024

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I would now like to give you an overview of the results for the firstquarter of the fiscal year ending September 2024.

2

Financial highlight
１

Q1 Results
YoY：Net sales decreased, profit increased.
YoY

Net sales：2

Progress rate against initial firsthalf earning forecast¥6,625million(465)million+51.0%

Operating income：¥435million+496million+217.7%

Profit attributable toowners of parent：¥630million+1,220million+1,261.0%

First-Halfearning forecast

Full-Yearearning forecast

Revised upward profit forecast
Net sales：

Maintained

13,000million

27,000million

Operating income：Upward revision for 1H only

600million

1,000million

Profit attributable toowners of parent：

Upward revision for
1H and full year

1,240million*

1,340million**Profit attributable to owners of parent reflects the revisions announced on February 9th.

3

Q1 Achievements and initiatives
・Healthcare business：Cloud drug record service and Childcare DX services performing well,
returning to profitability.
・School DX business：Many potential projects for April 2024 introduction.
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Here are the financial highlights.
(1) In the first quarter, net sales decreased compared to the same
period last year, while operating income, ordinary income, andprofit attributable to owners of parent increased.
Net sales has been within the expected range for the first half ofthe year.
However, profits have significantly exceeded expectations.
(2) As a result, we will revise upwards the profit forecast for boththe first half and full year.
(3)The achievements in the first quarter initiatives are as follows:
In the healthcare business, the number of pharmacies adopting
cloud drug record and the municipalities implementing childcare
DX have been progressing well, leading to a return to profitability.
Regarding the school DX business, contract acquisitions in April of
this year are proceeding smoothly.
We will provide detailed explanations of each specific initiative
shortly.

3

Consolidated P/L

Net sales : Decreased
Operating income, ordinary income, profit : increased（ Unit：Mil yen ）FY2023Q1

FY2024
Q1

YoY
AmountPercentage

Net sales

7,091

6,625

(465)

(6.6)%

Cost of sales

2,538

1,788

(750)

(29.6)%

+284

+6.2%

(212)

(4.6)%

ratio

35.8%

27.0%

Gross profit

4,552

4,836

ratio

64.2%

73.0%

SG&A

4,613

4,401

ratio

65.1%

66.4%

(61)

435

(0.9)%

6.6%

(88)

792

ratio

(1.3)%

12.0%

Profit attributable toowners of parent

(590)

630

ratio

(8.3)%

9.5%

Operating income
ratio

Ordinary income

The same period of previous year
739million Yen: Posting of spot sales ofthe video-streaming service
・ Loss-making projects 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

+496

-%

+881

-%

Increase in equity method investment
income+1,220-%The same period of previous year:
Posting of income taxes associated withthe transfer of shares between Group
companies

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I would now like to explain the consolidated P/L.
Net sales decreased by 6.6% compared to the same period last year
to 6.625 billion yen due to the rebound effect from video sales
recorded in the same period last year.
As a result of this, sales cost also decreased, leading to a 6.2%
increase in gross profit to 4.836 billion yen.
Operating income increased significantly to 435 million yen due to adecrease in selling ,general and administrative expenses.
Ordinary income increased significantly to 792 million yen due to anincrease in " a share of profit of entities accounted for using equity
method".
Profit attributable to owners of parent increased significantly to 630
million yen due to the impact of corporate taxes related to the intercompany stock transfer recorded in the same period last year.

4Consolidated SG&A

Advertising expenses : increased
Development costs（Subcontract expenses＋Depreciation）：decreased（ Unit：Mil yen ）FY2023Q1

FY2024
Q1

YoY
AmountPercentage

4,613

4,401

(2129

(4.6)%

Advertising expenses

479

626

+147

+30.8%

Personnel expenses

1,989

1,818

(170)

(8.6)%

Commission fee

746

709

(37)

(5.0)%

Subcontract expenses

560

441

(118)

(21.1)%

Depreciation

289

318

+28

+10.0%

Other

549

486

(62)

(11.4)%

SG&A

Increase in sales promotion
costs for AdGuard
Exclusion of subsidiaries fromconsolidation

Improved development costs(School DX business)

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SG&A decreased by 4.6% year-on-year to 4.401 billion yen.
This was due to an increase in advertising expenses in the content
business, offset by a decrease in personnel expenses resulting froma reduction in the number of employees due to the exclusion ofsubsidiaries from consolidation. Additionally, in the school DX
business, development activities stabilized, leading to a decrease insubcontract expenses.

5

Revision of First-Half and Full-Year earning forecasts[First-Half] Operating income, ordinary income, and profit have been revised upward.

（ Unit：Mil yen ）FY2024First-Half

FY2024First-Half（initial forecast）（current forecast）

Difference

13,00013,000-Operating income

200

600

+400

Ordinary income

200

1,000

+800

Profit attributable toowners of parent

50

1,240*+1,190*Net sales*Profit attributable to owners of parent (current forecast) and the differences reflect the revisions made to theconsolidated forecast for the second quarter (cumulative), announced on February 9th.
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Based on the first quarter financial results, we have revised ourforecasts for the first half and full year. For the first half forecast, wehave maintained our net sales projection as progress has been inline with our initial expectations.
However, we have upwardly revised our operating income by 40
million yen to 600 million yen, ordinary income by 80 million yen to
1 billion yen, and profit attributable to owners of parent by 65
million yen to 700 million yen.
(*Profit attributable to owners of parent has been upwardly revisedto ¥1,240 million, an additional ¥540 million as announced on
February 9th.)

6

Revision of First-Half and Full-Year earning forecasts[Full-Year] Operating income remains maintained, while ordinary income and profit forthe period have been revised upward.
（ Unit：Mil yen ）FY2024First-YearFY2024First-Year（initial forecast）（current forecast）

Difference

27,00027,000-Operating income

1,000

1,000

-

Ordinary income

1,000

1,400

+400

Profit attributable toowners of parent

400

1,340*+940*

Net sales*Profit attributable to owners of parent (current forecast) and the differences reflect the revisions made to theconsolidated forecast for the full year, announced on February 9th.
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For the full-year forecast, we've kept sales projections the same.
Operating income will remain unchanged for now, as we're still
reviewing it.
Any changes will be communicated promptly.
We've raised ordinary income and profit attributable to owners ofparent to 1.4 billion yen and 800 million yen, respectively, up by 400
million yen each.
(*Profit attributable to owners of parent has been upwardly revisedto ¥1,340 million, an additional ¥540 million as announced on
February 9th.)7Performance by segment

Content
Business・Content service(Entertainment & Life content)

・Original comics service

Security

Healthcare
Business
・Healthcare service for
women
・Childcare DX service
・Cloud drug record service
・Online consultation
service, etc.

School DX
Business・School DX service

Other
Business
・AI business・DX support businessfor companies
・Solution service forcorporate

comic

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Next, I would like to explain the performance by segment.

8

Content business : Net sales and operating income
QoQ（Unit：Mil yen）
5,100
4,639

4,436

5,118

※2

※1

4,384

4,342

4,317

4,289

4,210

Levelled off net sales
・The number of paying subscribers
remained almost unchanged.

Operating income slightly
decreased
・ Increase in advertising expenses

2,014
1,534

1Q

※1 1,439

1,322 1,328

2Q

3Q

FY2022

4Q

1Q

1,355

2Q

1,210

3Q

FY2023

1,218 1,091

4Q

1Q
FY2024

Special factors*1：Net sales & Operating income 717 million yen:
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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This is the quarterly trend of the content business.
Due to the paid membership numbers remaining almost unchanged,
the net sales has been trending flat.
The first quarter net sales amounted to 4.21 billion yen.
The operating income decreased slightly to 1.091 billion yen.

9

Content business : The number of paying subscribers

Total paying subscribers

3.63 million subscribers
5.00

4.81

4.25 4.08

4.67 4.59

4.48 4.38

3.96 3.88 3.78

4.23 4.16

3.69 3.57

3.52

3.95 3.89

Total paying subscribers

Flat3.80 3.79 3.76 3.73

3.33 3.27 3.20 3.20

3.69 3.68 3.63

・Brisk Security-related app

3.18 3.16 3.14 3.13 3.09

0.75 0.73 0.71 0.71 0.70 0.69 0.66 0.64 0.62 0.62 0.60 0.59 0.58 0.57 0.55 0.55 0.54
1Q

2Q

3Q

FY2020

4Q

1Q

2Q

3Q

4Q

1Q

FY2021
Healthcare business

2Q

3Q

4Q

1Q

FY2022

2Q

3Q

FY2023

4Q

1Q

FY2024

Content business

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The decline in the number of paid members in the content businesshas slowed further.
As of the end of December, the figure remained steady at 3.63
million people.

10

Content business: Security-related app

The security-related
app continues toperform well

Total paying subscribers

Total paying subscribers

720 thousand subscribers
Four functions

Ad blocking

Trace blocking

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
FY2020

FY2021

FY2022

FY2023Threat blocking

Parent function（Child protection
function）

FY2024

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The number of new subscribers for the security-related app"AdGuard" has been performing well, and the number of paid
members reached 720,000 by the end of December.

11

Content business: Original comics content businessNet sales

Original comics content businessStable growth・Keep in comic titles introduced
・ Reactionary decline after TV dramatization

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY2020

FY20211Q 2Q 3Q 4Q
FY20221Q 2Q 3Q 4Q 1Q
FY2023

FY2024

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The original comic business is also progressing well.
The download numbers and sales experience a sharp increase
temporarily due to the effect of popular works being adapted into TV
dramas.
However, there is a temporary decrease after the TV drama
adaptation, but overall, the business is experiencing stable growth.

12

Healthcare business: Net sales and operating income（Unit：Mil yen）

908

977

1,031

1,184 1,181

1,113

1,239 1,260

1,011

Net sales flat
112
9

(311)

1Q

2Q

(250)

3Q

(209)

4Q

FY2022

(172)

1Q

2Q

3Q

FY2023
Net sales

4Q

Profitability
trend continues
・Brisk Cloud drug record service
・Brisk Childcare DX service

(13)

(46)

(336)

QoQ

1Q
FY2024

Operating income
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The healthcare business achieved sales of 1.26 billion yen.
Thanks to the favorable performance of the cloud drug records andchildcare DX services, sales have been steadily increasing.
Operating income has shifted from a deficit in the previous fourth
quarter to a profitable trend due to increased revenue and cost
control measures.

13

Healthcare business: Monthly content service

Total paying subscribers(LunaLuna, CARADA medica)

0.54 million subscribers

Monthly subscription content service
Total paying subscribers

Levelled off
0.75 0.73

1Q

2Q

0.71 0.71 0.70 0.69

3Q

FY20204Q

1Q

2Q

0.66 0.64

3Q

FY2021

4Q

0.62 0.62 0.60

1Q

2Q

3Q

FY20220.59 0.58 0.57

4Q

1Q

2Q

0.55 0.55 0.54

3Q

FY2023

4Q

1Q

FY2024

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The number of paying subscribers in the healthcare business was
mostly unchanged at 540,000.

14

Healthcare business: Cloud drug record service

+130

1,923

1,923

pharmacies
introduced

1,793
1,639
1,532

Cloud drug record service
Total introduced pharmacies

Steady expansion

1,382
1,264
1,096
978
765
573
285
64

357

864

633

451

163

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q
FY2020

FY2021

FY2022

FY2023

FY2024

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The number of pharmacies introducing the cloud drug record service
has reached 1,923 stores, showing steady expansion.

15

School DX business: Net sales and operating income

Increased
revenue at thestart of theschool year
（Unit：Mil yen）

55

(121)

150

154

155

270

260

QoQ

Levelled off net sales

153

65

・Expansion in sales compared to thesame period last year
(107)

(111)

(246)

1Q

272

2Q

(302)

(305)

3Q

4Q

FY2022

1Q

(99)

(82)

QoQ

Operating deficit unchanged(214)

・Significant reduction in losses comparedto the same period last year
2Q

3Q

FY2023

4Q

1Q
FY2024

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Sales for the School DX business reached 260 million yen, remaining
flat compared to the previous quarter but expanding from thesecond half of the previous fiscal year. This is due to a concentrationof installations of the cloud-based school affairs support systems"BLEND" at the start of the school year in April, resulting in sales
being weighted towards the second half of the fiscal year.
Operating loss amounted to 82 million yen. Although the deficit
remained stable compared to the previous quarter, operating losses
have significantly reduced since the second half of the previous
fiscal year due to increased sales and reduced development
expenses.

16

School DX business：Cloud-based school affairs support system

Total introduced schools
566

Expansion of the numberof introduced schools

340

Covers 25% of private schools

114

FY2021
April,
2021

FY2022
April,
2022

April,
2023
FY2023（3月まで）
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There continues to be strong demand for cloud-based school affairs
support systems. The deployment of "BLEND" by our subsidiary is
progressing well, covering 25% of private high schools.

17Other business (Includes DX support business for companies, AI) :Net sales and operating income（Unit：Mil yen）

1,261

(36)

1,277

1,205

1,102

1,190

1,227

1,183

1,282

QoQ

Operating deficit reduced
・Substantial reduction in losses
compared to the same period last year
・Loss-making projects in the DX support
business for companies have wound down

(140)

(178)

(251)

1Q

1,221

2Q

3Q

(397)

(393)

(413)

(413)

4Q

1Q

2Q

3Q

FY2022

FY2023

Net sales

4Q

(87)

1Q
FY2024

Operating income
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Sales for the other businesses amounted to 1.282 billion yen, with
an operating loss of 87 million yen.
The decrease in sales costs and selling expenses, resulting from theresolution of deficit projects in the DX support business forcompanies in the fourth quarter of the previous period, led to asignificant reduction in losses.

18

Approach in Q2 and beyond

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Next, I would like to explain the approach in the second quarter offiscal year 2024 and beyond.

19

Basic policies and priority issues for FY2024

１. Healthcare business

Further sales growth・ Further expansion of the Cloud drug record service
・ Promotion of the platform strategy of the childcare DX, "Boshimo"

２. School DX business

Further sales growth・Expansion of the number of introduced schools

3. Content business

Securing profit
・ Original comics content business growth・ Security-related app growth

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In each segment, we will focus on priority issues based on thefollowing basic policies, respectively.
・In the healthcare business, we aim for further sales growth andachieve profitability for the full fiscal year. Specifically, we will focus
on expanding the Cloud drug record service and advancing theplatform strategy for the childcare DX.
・In the School DX business as well, we aim for profitability in thesecond half through further sales growth.
・ In the content business, despite a gradual decrease in thenumber of paid members, we aim to ensure profitability across thesegment through the growth of security-related apps and theoriginal comic business.

20

Healthcare business: Cloud drug record service
Connecting pharmacies and patients

Cloud drug record service

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I will explain the progress of the cloud drug record service in thehealthcare business.

21

Healthcare business: Cloud drug record service

Continuing to strengthen cooperation in sales and to
reinforce function development
1. Continuing to strengthen cooperation in sales•

Collaboration with a major prescription pharmaceutical wholesaler

2. Continuing to strengthen function development for differentiation•

Connecting the drug histories possessed by different pharmacies•

Home care and nursing functions•

Additive Logic, Guidance Navigation•

Planning to add electronic prescriptions and other functions as needed
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In the cloud drug record service, the number of pharmacies thathave introduced dispensing pharmacies is steadily increasing.
We will continue to strengthen our sales efforts and enhance thefunctionality of the service.
To strengthen sales, we will continue to cooperate in sales with ourbusiness partner MEDIPAL HOLDINGS CORPORATION and improve
efficiency by meticulously sharing sales information.
For function enhancement, we will enable information sharing
among group stores. Additionally, we will add features for at-homeand caregiving use, as well as electronic prescription compatibility.

22

Healthcare business:
Maternal and child health handbook app + Childcare DX services
Connecting parenting households and municipalities & hospital

Maternal and child health handbook app+ Childcare DX services

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Next, I would like to explain our progress targets for the maternaland child health handbook app “Boshimo” and childcare DX services.

23

Healthcare business:
Maternal and child health handbook app + Childcare DX services
Accelerated introduction of childcare DX services at municipalities using “Boshimo”
Phase1

Phase2Phase3

Maternal and childhealth handbook app

Online consultation

Childcare DX services

91

150

599

Tailwind for the“Accompanying
Support Program”*

1Q

3Q

FY2017

1Q

3Q

FY20181Q

3Q

FY20191Q

3Q

FY2020

1Q

3Q

FY2021

1Q

3Q

FY2022

1Q

3Q

1Q

FY2023
FY20244Q 1Q
FY20202Q

3Q

FY2021

4Q

1Q 2Q

3Q

FY2022

4Q

1Q

2Q 3Q
FY2023

4Q

1Q

FY2024

1Q

2Q

3Q

FY2022

4Q

1Q

2Q

3Q

FY2023

4Q

1Q
FY2024* Policy initiated by the Ministry of Health, Labour and Welfare in January 2023. Transferred to “Children and Families Agency” from April 1 .
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Among the 1,741 municipalities nationwide, the number ofmunicipalities that have introduced the "Boshimo" app reached 599
as of the end of September. "Boshimo" has become the standard
maternal and child health handbook for municipalities.
The number of municipalities that have also introduced the online
consultation service has reached 91.
The additional introduction of our focused "Childcare DX service" isprogressing well, and as of the end of September, we have reacheda total of 150 introductions.
We will continue to increase the number of municipalities
introducing childcare DX services, thereby contributing to the
expansion of sales.

24Motivation Works Inc.

School DX businessConnecting students and teachers

Cloud-based school affairs support system

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Next, I would like to explain more about the school DX business.

25

School DX business：Cloud-based school affairs support system

Motivation Works Inc.

Improving efficiency in school administration and he quality of education
Cloud-based school affairs
support system

Learning
management

Attendance
management

Grademanagement

Formmanagement

Student
information

Student
memo

Officemanagement

・・・
Health care

Entrance exam
management

External
mock test

連絡機能
連絡管理

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The school affairs support system "BLEND" in the School DX
business provides all school operations in a full cloud-based manner,
not only for managing student attendance and grades but also for allother administrative tasks.
By introducing “BLEND”, we significantly reduce administrative
burdens, allowing teachers to focus on teaching.
Furthermore, information registered in “BLEND” can be shared not
only with teachers but also with students' parents.
We aim to improve the efficiency of school operations and enhance
the quality of education through the implementation of “BLEND” inschools.

26

School DX business：Cloud-based school affairs support system

Motivation Works Inc.

Image of medium-term profit

Aiming to expand thenumber of schools to be
introduced

Planned・ Contract awards for introduction in
April 2024 are on track

FY2021 FY2022 FY2023 FY2024 FY2025 FY2026

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Here is an image of medium-term profit for the school DX business.
We anticipate that the increase in the number of schools adopting
our system will continue in the near term, leading to a trend ofincreased sales. We have been able to significantly reduce thedevelopment costs per school from the initial stages. By expanding
the number of schools adopting our system, we aim to achieve
profitability in the second half of the fiscal year.

27

Image of medium-term profit

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Next, I will explain the image of medium-term profit.

28

Image of medium-term profit (by segment)

Healthcare business
Focus on expansion of stock sales (=profit)

Content business
Degree of decrease in the number of paying subscribers is reduced
Focus on highly in-demand contents

School DX business
Sharp growth in a short period of time

Other business(Includes DX support
business for companies, AI)
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The image of medium-term profit is as follows.
The company is investing in new businesses such as healthcare andschool DX using the cash cow from the content business.
These upfront investments will continue in the near term, but there
is a trend of reducing losses, and we anticipate achieving
profitability in the future.
Especially, we anticipate that the school DX business will experience
the fastest business growth.
In the medium term, we consider the healthcare business to be thedriving force for profit growth. Therefore, we will continue to focus
on the successful cloud drug record and childcare DX.
Through the expansion of stock sales in each business, we aim toachieve "sustainable growth" across the entire group.

29

〈Contact us〉
Investor Relations Officee-mail: ir@mti.co.jp
https://ir.mti.co.jp/eng/

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Thank you for your time.

30