Non-Consolidated Financial Results
for the Three Months Ended July 31, 2023
[Japanese GAAP]
September 6, 2023
Company name: Asukanet Co., Ltd.
Stock exchange listing: Tokyo Stock Exchange
Code number: 2438
URL: https://www.asukanet.co.jp
Representative: Yuji Matsuo, Representative Director & President
Contact: Kenya Kono, Senior Managing Director & CFO
Phone: +81-82-850-1200
Scheduled date of filing quarterly securities report: September 14, 2023
Scheduled date of commencing dividend payments: Availability of supplementary briefing material on quarterly financial results: Not availableSchedule of quarterly financial results briefing session: Not scheduled(Amounts of less than one million yen are rounded down.)
1. Non-Consolidated Financial Results for the Three Months Ended July 31, 2023
(May 1, 2023 to July 31, 2023)(1) Non-Consolidated Operating Results(% indicates changes from the previous corresponding period.)
Net sales
Three months ended
July 31, 2023
July 31, 2022

Operating income

Ordinary income

ProfitMillion yen%

Million yen%

Million yen%

Million yen%

1,609
1,543

4.3
5.2

2852(45.1)
24.3

3456(38.6)
32.02238(40.5)
35.6

Basic earnings
per share

Diluted earnings pershare

Three months ended
Yen
Yen
July 31, 2023
1.38
July 31, 2022
2.30
(Note) Diluted earnings per share is not presented as there were no potential shares.
(2) Non-Consolidated Financial Position
Total assets

Net assets

Million yen

6,724
As of July 31, 2023
7,134
As of April 30, 2023
(Reference) Equity: As of July 31, 2023: ¥5,938 million
As of April 30, 2023: ¥6,203 million

Equity ratio

Million yen%

5,938
6,203

88.3
86.9

2. Dividends1stquarter-end

2ndquarter-end

Yen

Yen

Annual dividends
3rdYear-end
quarter-end

Fiscal year ended April 30, 2023
0.00
Fiscal year ending April 30, 2024
Fiscal year ending April 30, 2024
0.00
(Forecast)(Note) Revision to the forecast for dividends announced most recently: No

Total

Yen

Yen

Yen-

9.00

9.00

-

7.00

7.00

3. Non-Consolidated Financial Results Forecast for the Fiscal Year Ending April 30, 2024
(May 1, 2023 to April 30, 2024)(% indicates changes from the previous corresponding period.)
Basic earnings
Net salesOperating income
Ordinary income
Profitper share
Million yen%

Million yen%

Million yen%

Million yen

Full year
7,330
5.1
495(15.4)505 (18.3)(Note) Revision to the financial results forecast announced most recently: No%

Yen

353 (26.7)

21.28* Notes:(1) Accounting policies adopted specially for the preparation of quarterly financial statements: Yes(2) Changes in accounting policies, changes in accounting estimates and retrospective restatement
1) Changes in accounting policies due to the revision of accounting standards: No2) Changes in accounting policies other than 1) above: No
3) Changes in accounting estimates: No4) Retrospective restatement: No(3) Total number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares):
July 31, 2023: 17,464,000 shares
April 30, 2023: 17,464,000 shares2) Total number of treasury shares at the end of the period:
July 31, 2023: 1,022,257 shares
April 30, 2023: 842,257 shares
3) Average number of shares during the period:
Three months ended July 31, 2023: 16,570,421 sharesThree months ended July 31, 2022: 16,784,101 shares* These quarterly financial results are outside the scope of quarterly review procedures by a certified public
accountant or an audit corporation.
* Explanation of the proper use of financial results forecast and other notes
The earnings forecasts and other forward-looking statements herein are based on information currently
available to the Company and certain assumptions that the Company believes are reasonable, and actual results
may differ significantly from these forecasts due to a wide range of factors.

4. Overview of Business Results(1) Overview of Business Results for this Consolidated First Quarter
Asukanet operates three business areas, each with different positioning and characteristics. They are (1) the funeral business,
which adds digital processing and remote output services for photos of the deceased to a funeral business that is largely unaffectedby economic trends, (2) the photo book business, which provides ideas for new photo output methods that allow users to create
complete photo collections beginning from just a single book, and (3) the aerial display business, which is utilizing unique,recently-developed technologies aiming to create a new market and achieve dreams.
Following is an overview of the business results for each segment. The result figures for each segment include internal intersegment sales.
(Funeral business)
In this business, although a downturn in the numbers of funerals held nationwide was seen compared to the previous year,
there was strong growth in our primary business area of services processing photos of the deceased as a consequence of steadilyacquiring new contracts with funeral companies through our marketing operations. As a result, there was a steady increase insales of supply products such as frames and paper.
We have renovated the service site of our “tsunagoo” service, which was released in the funeral market as part of our “funeraltech” services utilizing IT technologies. We exhibited at the Funeral Business Fair that was held in June, and focused ourpromotions primarily on the advantages of “tsunagoo” and on our focus restoration technologies.
In terms of income, due to the excessive workload on operators in the Image Processing Division, we engaged in active staffrecruitment. We also implemented a raise in base salary as of the end of the previous fiscal year. As a result, there was a slightdecrease in segment income.
As a result, Q1 sales were 718,673 thousand yen (106.6% year-on-year), and Q1 segment income was 119,732 thousand yen(90.0% year-on-year).
(Photo book business)
This business operates AsukaBook for the professional photography market in Japan, and MyBook for the general Japanese
consumer market. We are also engaged in OEM supply of photo albums and photo prints based on photos that were taken withsmartphones.
In the professional photographers market, our primary business of wedding photo albums has overcome the negative effectsof the coronavirus pandemic and we can also see a trend toward recovery. There were strong sales of studio photography forfamily photos and photos of children. Sales were also higher compared with the same quarter in the previous fiscal year.
Initiatives included holding online seminars, exhibiting at PHOTONEXT2023, and adding new functions to our “Grandpic” datadelivery system.
In the general consumer market, business was affected by voluntary restrictions on activities such as traveling and events dueto the coronavirus pandemic, and also by a reduction in opportunities for taking photos resulting from the constant mask wearing.
Difficult conditions are continuing for both our company’s MyBook brand and OEM, and sales were down from the same quarterof the previous fiscal year.
In terms of income, although we were affected by the soaring prices of raw materials and increased personnel cost, the positiveeffect of several improvements and decreasing depreciation were large factors driving an increase in segment income.
As a result, Q1 sales were 858,013 thousand yen (101.3% year-on-year), and Q1 segment income was 159,454 thousandyen (106.7% year-on-year).
(Aerial display business)
This business is aiming to create a market through new image and video expressions utilizing aerial imaging technologies.
We are developing, manufacturing, and selling both glass and plastic “ASKA3D plates” that utilize our original technologies toproject images in mid-air.
In the area of marketing, we are carrying out sales centered on our Marketing Division in Japan, and centered on our agents
overseas. In Japan, we exhibited at the 13th Content Tokyo 2023 Advanced Digital Technology Expo in June, demonstratingideas of remote customer reception system using the life-size characters and an aerial arcade game. We also installed ademonstration system in the media center at the G7 Summit that was held in Hiroshima, and have had success in installingsystems in corporate reception areas. Overseas, marketing activities returned mostly to normal even at our China agent, which
had suffered the effects of the coronavirus pandemic for a prolonged period. In May, we exhibited at the InfoComm Asia 2023
exhibition held in Bangkok, Thailand. Through our Middle East agent, we proceeded with installation of an aerial display at abank in Kuwait. Sales have centered primarily on our glass ASKA3D plates, with the results exceeding those from the firstquarter of the previous year.
In terms of production and development, we made progress in production trials of plastic 310 mm size ASKA3D plates, andconducted production development using materials with superior environmental performance. At our technical development
center, we also challenged ourselves in trials to gradually increase the sizes of our glass ASKA3D plates.
In terms of profit and loss, segment loss was higher than the same quarter in the previous fiscal year due to our participationin domestic exhibitions, advertising expenses and quality control, and patent-related expenses.
As a result, Q1 sales were 34,372 thousand yen (148.0% year-on-year), and Q1 segment loss was 86,792 thousand yen(compared to a loss of 76,542 thousand yen in the same quarter of the previous fiscal year).
As results of the above, sales were 1,609,174 thousand yen (104.3% compared to the same quarter of the previous fiscal year).
In terms of profits, there was a cost increase in company-wide expenses, establishment of “XLab” for new business development,and information technology and system-related expenses. As a result, ordinary income was 34,741 thousand yen (61.4% year-onyear) and net income was 22,932 thousand yen (59.5% year-on-year).

(2) Overview of the Financial Status during this Quarter
Assets at the end of this first quarter decreased by 410,036 thousand yen from the end of the previous fiscal year to reach
6,724,822 thousand yen. This was primarily due to a decrease in cash and savings of 417,920 thousand yen.
Liabilities at the end of this first quarter decreased by 145,589 thousand yen from the end of the previous fiscal year to reach
786,172 thousand yen. This was primarily due to a decrease in corporate tax payable of 67,400 thousand yen and a provision forbonuses of 100,500 thousand yen.
Net assets at the end of this first quarter decreased by 264,447 thousand yen to reach 5,938,650 thousand yen. Despite an increasein quarterly profit of 22,932 thousand yen, this was primarily due to a decrease of 149,595 thousand yen in payment of dividends
from surplus and 149,417 thousand yen in treasury stock acquisition.

(3) Future Outlook
There are no changes to the future outlook for the fiscal year ending April 2024 that were announced on June 9, 2023.

5. Financial Statements for the first quarter of the Fiscal Year
(1) Balance sheet(Units: 1,000s yen)Previous fiscal year
(Ended April 30, 2023)
Asset
Current assets
Cash and deposits
Accounts receivable-trade
Merchandise and products
Work in progress
Raw materials and supplies
OthersAllowance for doubtful accounts
Total current assets

End of current Q1(Ended July 31, 2023)

2,049,027
886,554477,047
185,485
89,29860,002(1,793)

1,631,106
819,124
550,806
158,00289,55951,375(2,154)

3,745,622

3,297,820

Fixed assets
Tangible fixed assets
Buildings, net
Machinery and equipment, net
Land
Others net

873,048
415,124
844,060
184,668

861,604
417,903
844,060
214,446

Total tangible fixed assets

2,316,903

2,338,015

Intangible fixed assets
Total investments and other assets
Investment securities
Others219,310

220,911

634,410
218,613646,800
221,275

Total investment and others

853,023

868,075

3,389,237

3,427,002

7,134,859

6,724,822

Liabilities
Current liabilities
Accounts payable-trade
Accounts payable-other
Income taxes payable
Provision for bonuses
Others187,109
208,545
87,200193,800
245,681

167,640
239,839
19,80093,300256,629

Total of current liabilities

922,337

777,210

5,351
4,072

5,248
3,713

9,424

8,961

Total liabilities

931,761

786,172

Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock

490,300
624,486
5,561,278(487,857)

490,300
624,486
5,434,615(637,274)

6,188,207

5,912,127

14,89026,522

Total fixed assets
Total assets

Fixed liabilities
Provision for retirement benefits
OthersTotal fixed liabilities

Total shareholders' equity
Valuation and translation adjustments
Valuation difference on available-for-sale securities
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

14,89026,5226,203,097

5,938,650

7,134,859

6,724,822(2) Profit and loss statement

Net Sales
Cost of sales(Units: 1000s yen)First quarter of the previous fiscal First quarter of the current fiscal
yearyear(May 1, 2022 – July 31, 2022)(May 1, 2023 – July 31, 2023)
1,543,046
1,609,174
825,993891,673

Gross profit

717,052

717,501

Selling, general, and administrative expenses

664,725

688,786

Operating income

52,32728,714Non-operating income
Interest received
Dividends received
Commissions received
Exchange gain
Others600
600
772,749524

1,213675
67
4,026
509

4,552

6,491293―448
16

Total non-operating income
Non-operating expenses
Expense for purchasing treasury stocks
OthersTotal non-operating expenses
Ordinary income
Extraordinary losses
Loss from retirement of fixed assets
Total extraordinary income

293

465

56,58634,741073

073

Net income before taxes

56,586

34,667

Income taxes

18,047

11,735

Net income

38,53822,932

[Segment information]
First quarter of the current fiscal year (May 1, 2022 – July 31, 2022)
Information related to the amounts of sales, income, and loss for each reporting segment(Units: 1,000s yen)Reporting segment
Adjustments

Amountrecorded in
profit and loss
statement

1,543,046―

1,543,046

―

1,478

(1,478)―847,232

23,223

1,544,524(1,478)1,543,046

149,430(76,542)

205,905(153,578)

52,327

Funeral businessPhoto bookbusiness

Aerialdisplay business

674,069

845,753

23,223―

1,478

674,069
133,016

Total

Sales
Sales to outside
customers
Inter-segment internalsales and transfers
Total
Segment income (loss)

First quarter of the current fiscal year (May 1, 2023 – July 31, 2023)
Information related to the amounts of sales, income, and loss for each reporting segment(Units: 1,000s yen)
Reporting segment
Adjustments

Amountrecorded in
profit and loss
statement

1,609,174―

1,609,174

540

1,883

(1,883)―858,01334,372

1,611,058(1,883)

1,609,174

159,454(86,792)

192,394(163,679)

28,714

Funeral businessPhoto bookbusiness

Aerialdisplay business

718,673856,669

33,832―

1,343

718,673
119,732

Total

Sales
Sales to outside
customers
Inter-segment internalsales and transfers
Total
Segment income (loss)

This is the summarized translation of released report for your reference.
Please refer to the original Japanese financial document.