This is an unofficial translation. In case of any difference in meaning between the original Japanese text and the English translation, Japanese text shall prevail.

Consolidated Summary Report under Japanese GAAP
for the second quarter of the fiscal year ending June 30, 2023
Company Name:
Code Number:
Representative:
For inquiry:

January 31, 2022
Stock exchange listings: Tokyo

AVANT GROUP CORPORATION(Formerly AVANT CORPORATION)
3836(Title) President, Group CEO(Name) Tetsuji Morikawa(Title) Director, Group CFO(Name) Naoyoshi Kasuga

Securities report issue date: February 13, 2023
Supplementary information for financial statements: Available
Explanatory meeting to be held: Yes

URL: https://www.avantgroup.com/
TEL: (03) 6388-6739

Dividend payment date: -1. Consolidated results for the Second quarter of the fiscal year ending June 30, 2023
(Millions of yen, rounded down to the nearest unit)(Percentages indicate year-on-year changes)(1) Consolidated results of operations
Revenue
Second quarter of the
fiscal year
ending June 30, 2023
ended June 30, 2022
Comprehensive income (loss)

EBITDA%

10,523
8,751

1,989
1,616

for the 2Q of the fiscal year ending June 30, 2023

Second quarter of the
fiscal year
ending June 30, 2023
ended June 30, 2022

Ordinary income

Profit attributable toshareholders of parent
company

%

%

%

%

20.2
-

Net profit per
share

Operating income

23.1
-

1,793
1,482

1,145 million yen (27.3%)

21.0
-

1,779
1,437

23.8
-

for the 2Q of the fiscal year ended June 2022

1,142
865

32.0
-

899 million yen (-)

Diluted net
profit per share

yen

yen

30.35
23.01

-

(Notes) EBITDA is derived by adding depreciation and amortization of goodwill to operating income.
The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc. from the beginning of the first quarterof the fiscal year ended June 30, 2022, and the figures for the second quarter of the fiscal year ending June 30, 2022 are after the application of the said accounting
standard, etc., so the percentage change from the same quarter of the previous year is not stated.

(2) Consolidated financial condition
Total Assets
As of

Net Assets

Equity Ratios

Unit: million yen

Unit: million yen%

15,937
16,617

11,288
10,59770.8
63.8

December 31, 2022
June 30, 2022

(Reference) Net assets attributable to the company’s shareholders

As of December 31, 2022

11,288 million yen

As of June 30, 2022

10,597 million yen

2. Dividends on common stock
Dividends per share
1st
2nd
3rd
Fiscalquarter-end quarter-end quarter-end year-end

AnnualFiscal Year Ended

yen

yen

yen

yen

yen

June 30, 2022
June 30, 2023
June 30, 2023 (Forecast)

-

0.00
0.00

-

13.00

13.00

-

15.00

15.00

Revisions to the most recently announced dividend forecast: None
(Note) Breakdown of year-end dividend for the fiscal year ending June 30, 2022: ordinary dividend of 12.00 yen and commemorative dividend of 1.00 yen (25th anniversaryof the Company's founding)

3. Consolidated earnings forecasts for the fiscal year ending June 30, 2023
(Percentages indicate year-on-year changes)

Revenue

Operating income

Profit attributable toowners of parent
company

Ordinary income

Net profit
per share

Fiscal Year ending

Unit: million yen%

Unit: million yen%

Unit: million yen%

Unit: million yen%

yenJune 30, 2023

21,800

16.6

3,100

-4.5

3,100

3.7

2,030

-0.7

53.93

(Notes)

Revisions to the most recently announced earnings forecast: None

Notes(1) Changes in significant subsidiaries during the period (changes in “Specified Subsidiaries” (Tokutei Kogaisha) accompanying changes
in scope of consolidation): No
Newly added to the scope of consolidation: nil
Newly deleted from the scope of consolidation: nil(2) Application of accounting procedures specific to the preparation of quarterly consolidated financial statements: none
(3) Changes in accounting policies, accounting estimates and correction of past errors:(i) Changes in accounting policies due to revision of accounting standards: Yes(ii) Changes in accounting policies due to reasons other than item (i) above: No(iii) Changes in accounting estimates: No(iv) Correction of past errors: No
Note: For details, please refer to "2. Quarterly Consolidated Financial Statements and Major Notes (4) Notes to Quarterly Consolidated Financial
Statements (Changes in Accounting Policies)" on page 15 of the attached document.

(4) Number of shares outstanding (common stock)(i) Total shares outstanding including treasury stock(ii) Shares of treasury stock held(iii) Average outstanding shares*

As of December 31, 2022

37,645,851 shares

As of June 30, 2022

As of December 31, 2022

2,998 shares

As of June 30, 2022

Second quarter of the fiscal year
ending June 30, 2023

37,629,691 shares

Second quarter of the fiscal
year ended June 30, 2022

37,625,501 shares
2,998 shares
37,606,311 sharesThis report is exempt from the audits of CPAs or Audit firms.

* Explanation of the appropriate use of earnings forecasts and other special notes
Forward-looking statements in this report, including earnings forecasts, are based on information currently available to the Company
and on certain assumptions deemed to be reasonable. These statements are not promised by the Company regarding future performance.
Actual results may differ materially from the forecast depended on a range of factors. Please refer to "Earnings Forecasts" on page 8 forthe assumptions for earnings forecasts and notes for using earnings forecasts.

Accompanying Materials – Table of Contents
1. Qualitative Information on Financial Results for the Current Quarter .................................................... 2(1) Management's Discussion on Business Operations .............................................................................. 2(2) Discussion on Financial Condition .......................................................................................... 6(3) Earnings Forecasts ...................................................................................... ................. 8
2. Quarterly Consolidated Financial Statements and Notes.................................................................. 9(1) Quarterly Consolidated Balance Sheets.......................................................................................... 9(2) Quarterly Consolidated Statements of Income and Statements of Comprehensive Income......................... 11
Quarterly Consolidated Statements of Income ................................................................................. 11
Quarterly Consolidated Statements of Comprehensive Income ......................................... 12(3) Quarterly Consolidated Statements of Cash Flows ..................................................................... 13(4) Notes to Quarterly Consolidated Financial Statements ..................................................................... 15(Notes on the Going Concern Assumption) .............................................................................. 15(Notes on Substantial Changes in the Amount of Shareholders' Equity) .................................. 15(Changes in Accounting Policies) ........................................................................................................ 15(Additional Information) ........................................................................................................... 15(Segment Information) ............................................................................................. 16(Business Combinations, etc.) ........................................................................................................... 17(Revenue Recognition) ........................................................................................................... 1 8- 1 -1. Qualitative Information on Financial Results for the Current Quarter(1) Management's Discussion on Business Operations
Consolidated financial results for the second quarter of the current fiscal year are as follows.
Fiscal Year ended June30, 2022
Second quarter(millions of yen, rounded down to the nearest unit)
Fiscal Year ending June
Year on Year Change
30, 2023
Second quarter
Amount%Net sales

8,751

10,523

1,771

20.2

Operating income

1,482

1,793

311

21.0

Ordinary income

1,437

1,779

342

23.8

865

1,142

276

32.0

Profit attributable to owners ofparent company

Consolidated net sales were 10,523 million yen (up 20.2% year-on-year) as a result of steady growth in all threebusinesses: Group Governance, Digital Transformation, and Outsourcing, as we proactively responded to growing
investment needs among Japanese companies, our customers, to maintain and strengthen competitiveness by"upgrading corporate management and activities using data and digital technology," which is becoming a mid- tolong-term trend.
The ratio of recurring sales (sales that occur on an ongoing basis, such as software maintenance fees), which is oneof the management indicators in the medium-term management plan, was 34.6%, down 0.2 percentage points fromthe same period of the previous year, due to factors such as large projects driving high consulting service sales growthat the large Group Governance Business and Digital Transformation Business, which exceeded the effect of increased
sales from the Outsourcing Business, where the recurring sales ratio is constantly maintained at around 90%. On theother hand, total recurring sales continued to grow steadily, increasing 19.6% year-on-year.
As for profits, in addition to increases in fixed personnel expenses due to improved compensation and an increasein headcount to strengthen competitiveness for the purpose of securing human resources, and an increase inoutsourced processing expenses in response to an increase in orders, due to the group reorganization there were also
rebranding expenses reorganization, and costs due to product rationalization and improvement of development
environment at the operating companies. However, these factors were offset by the effect of increased sales in eachbusiness segment, resulting in operating income of 1,793 million yen (up 21.0% year-on-year), ordinary income of
1,779 million yen (up 23.8% year-on-year), and net income attributable to shareholders of the parent company of
1,142 million yen (up 32.0% year-on-year).

- 2 -The status of each reportable segment is as follows.
(i) Net sales

Group Governance Businesses
Digital Transformation BusinessOutsourcing BusinessEliminationofinter-segment
transactions
Consolidated Net sales

Fiscal Year ended June30, 2022
Second quarter
4,279
3,370
1,466

(millions of yen, rounded down to the nearest unit)
Fiscal Year ending June
Year on Year Change
30, 2023
Second quarter
Amount
%
5,151
871
20.4
3,940
569
16.9
1,816
350
23.9

(365)

(385)

(19)

-

8,751

10,523

1,771

20.2

Fiscal Year ended June30, 2022
Second quarter
885
552
356

Fiscal Year ending June30, 2023
Second quarter
1,020
718
418

(312)
1,482

(ii) Operating income(millions of yen, rounded down to the nearest unit)

Group Governance Businesses
Digital Transformation BusinessOutsourcing BusinessCorporate Expenses and Eliminationof inter-segment transactions
Consolidated operating income

Year on Year Change
Amount

%
134
166
61

15.2
30.1
17.3

(363)

(51)

-

1,793

311

21.0

In the Group Governance Business, net sales were 5,151 million yen, up 20.4% from the same period of the previous
year. In addition to consolidated accounting and disclosure solutions, growth in solutions that contribute to groupmanagement information control drove growth, with the increase in sales of consulting services the main reason for
the rise in sales during the quarter. Due to factors such as costs for product rationalization and improvement of thedevelopment environment, margins declined from the same period of the previous year, but due to the forementioned
increase in in net sales, profits grew, resulting in operating income of 1,020 million yen (up 15.2% year-on-year).
In the Digital Transformation Business, the need among customers to utilize data for decision making related to
management and business promotion continues to accelerate and has shifted to a focus on provision of cloud data
platforms and ever larger projects. On the other hand, the business intelligence-related development, the traditionalcore of the business also grew was also strong, resulting in an increase in net sales to 3,940 million yen (up 16.9%
year-on-year). An increase in personnel expenses due to higher compensation levels intended to strengthen
competitiveness in order to secure personnel was offset by the effect of higher sales, and operating income was 718
million yen (up 30.1% year-on-year), significantly higher than the same period a year earlier.
In the Outsourcing Business, while continuing to maintain high net sales growth rates, recurring sales continued tobuild steadily, resulting in net sales increasing to 1,816 million yen (up 23.9% year-on-year). In terms of profitability,
factors that increased costs, such as an increase in office space due to increasing headcount, led to margins declining
from the year earlier period, but due to sales growth operating income increased to 418 million yen (up 17.3% yearon-year).

- 3 -The number of employees on a consolidated basis was 1,263 at the end of the second quarter, up 37 from the end of
the previous fiscal year.
The number of consolidated employees for the first quarter of the fiscal year ending June 30, 2023, included thenumber of temporary employees, and has been revised to exclude the number of temporary employees to maintainconsistency with the previous figures.
Quarterly Trends of Number of Employees of the GroupThe status of orders received and sales by segment in the second quarter of the fiscal year under review is as follows.
(i) Orders Received
Fiscal Year ended June 30,
2022
Second quarter
OrdersOutstanding
Received
OrdersGroup GovernanceBusinesses
Digital Transformation
Business
Outsourcing BusinessElimination of inter-segment
transactions
Total(millions of yen, rounded down to the nearest unit)
Fiscal Year ending June 30,
Year on Year Change
2023
Second quarter
AmountOrdersOutstanding
OrdersOutstanding
Received
Orders
Received
Orders

4,516

2,586

5,432

3,397

915

810

3,374

1,247

4,212

1,403

838

155

1,946

1,937

1,393

2,023

(552)

85

(402)

(327)

(155)

(332)

247

(5)

9,434

5,444

10,882

6,490

1,448

1,046

(ii) Net Sales

Group Governance Businesses
Digital Transformation BusinessOutsourcing BusinessElimination of inter-segment
transactions
Total

Fiscal Year ended June 30,
2022
Second quarter
4,279
3,370
1,466

(millions of yen, rounded down to the nearest unit)
Fiscal Year ending June 30,
Year on Year Change
2023
Second quarter
Amount
%
5,151
871
20.4
3,940
569
16.9
1,816
350
23.9

(365)

(385)

(19)

－

8,751

10,523

1,771

20.2

- 4 -

Quarterly trends in net sales and operating income are as follows:
Net Sales and Operating Income for the Last four quarters(millions of yen, rounded down to the nearest unit)
Fiscal Year ending
June 30, 2023
First quarter
Second quarter

Fiscal Year ended
June 30, 2022
Third quarter
Fourth quarter
Net sales

5,035

4,916

5,025

5,497

Operating income

1,140

624

614

1,178

Operating income margin
(%)

22.7

12.7

12.2

21.4

Quarterly trends of net sales, operating income and operating margins- 5 -(2) Discussion on Financial Position(i) Financial position
Total assets at the end of the second quarter were 15,937 million yen (down 679 million yen from the end of theprevious fiscal year). This was mainly due to a 1,111 million yen decrease in current assets, which was mainly
attributable to a 1,841 million yen decrease in cash and deposits and a 166 million yen increase in prepaid expenses,
and a 534 million yen increase in notes, accounts receivable - trade and contract assets, while non-current assets
increased by 432 million yen, which was mainly attributable to increased office space, with a 112 million yen increasein property, plant and equipment, and a 120 million yen increase in leasehold and guarantee deposits.
On the other hand, total liabilities amounted to 4,649 million yen (down 1,370 million yen from the end of theprevious fiscal year). This was mainly due to a decrease of 586 million yen in income taxes payable, a 262 million
yen decrease in contract obligations, and a 434 million yen decrease in provision for bonuses.
Total net assets amounted to 11,288 million yen (up 690 million yen from the end of the previous fiscal year) due
to the recording of 1,142 million yen in net income attributable to parent company shareholders and payment of 489
million yen in dividends from retained earnings. As a result, the equity ratio was 70.8% (63.8% at the end of theprevious fiscal year), an improvement of 7.0 percentage points from the end of the previous fiscal year, and theCompany believes it maintains a highly stable financial balance with low interest-bearing debt.
(ii) Cash Flow
Cash and cash equivalents (hereinafter referred to as "cash") at the end of the first quarter decreased by 1,842 million
yen from the end of the previous fiscal year to 8,160 million yen. The status of each cash flow and their factors are
as follows.
< Net cash provided by (used in) operating activities >Funds used in operating activities totaled 717 million yen. (284 million yen used in the same period of the previous
year)
The main factor of increase was income before income taxes and minority interests of 1,779 million yen, while themain factors of decrease were decrease in provision for bonuses of 434 million yen, increase in notes, accounts
receivable - trade and contract assets of 534 million yen, decrease in accounts payable - other and accrued expenses
of 142 million yen, a decrease in contract obligations of 262 million yen and income taxes paid of 880 million yen.
< Net cash provided by (used in) investing activities >Funds used in investing activities totaled 622 million yen. (254 million yen used in the same period of the previous
year)
The main accounts of cash outflow were 113 million yen for purchase of property, plant and equipment, 375 million
yen for purchase of intangible assets, and 120 million yen for payment of leasehold and guarantee deposits, while themain accounts of cash inflow were 90 million yen for proceeds from redemption of marketable securities.
< Net cash provided by (used in) financing activities >Net cash used in financing activities totaled 499 million yen. (422 million yen used in the same period of the previous
year)
The main component of cash outflow was 489 million yen in cash dividends paid.

- 6 -In our group, cash flow from operating activities in the first quarter are at a low level due to the payment of income
taxes and the payment of performance-based bonuses to officers and employees, and it gradually increases from thesecond quarter onward, and is typically positive for the full fiscal year (In the second quarter of this fiscal year,
cashflow has been different from previous years due to factors such as an increase in sales of consulting services,which require working capital upfront, but for the full year cashflow is expected to turn positive as in previous years).
Maintenance fees in the consolidated accounting related business and commissions paid for the outsourcing businessare prepaid for the year in advance of the provision of services, so as a result, the original business model has almost
no need for working capital. On the other hand, in the Digital Transformation Business as outsourcing costs and otherexpenses are paid in advance, working capital demand will increase as sales grow. However, by concentrating theexcess funds of the Group as a whole in the holding company, the Group is able to smoothly extend funds across theGroup. In addition to the total amount of cash held, the Group has established a commitment line totaling 3.5 billion
yen with banks with which it does business. Accordingly, at present there are no concerns about funding, and rather,
we intend to use the excess funds for strategic investment in the future.
Quarterly trends of Operating cash flow (millions of yen)

- 7 -(3) Earnings Forecasts
In September 2018, the Company announced a five-year plan (target to be achieved in five years) as its MediumTerm Management Plan, and the fiscal year ending June 2023 is the final year of the plan. Ahead of finalizing ournext medium term management plan commencing in the fiscal year ending June 2024, we have defined the materialityof the Avant Group as "to become a software company that helps enhance corporate value," and have clarified what
we aim to become during the period of the next medium-term plan. As a concrete measure to realize this materiality,
we have reorganized the group and started business activities as the new Avant Group on October 1, 2022.
The reorganization of the group will also clarify the direction of each operating company and expand the means ofresponse, thereby enabling us to respond to growing needs better than ever before and achieve sustainable sales
growth. At the same time, in order to maximize the effects of the reorganization, we plan to aggressively implement
expenditures for the future, including a review of the Group's branding and a fundamental revision of our productdevelopment strategy, including a rationalization of our low-profit products.
Although there is a risk that the spread of the new coronavirus infection, which has yet to subside, and the situationin Ukraine may indirectly affect the Group's performance, we believe that demand for the Group's business, such as
the increasing number of companies that want to utilize data for management and strengthen group governance, willrather continue to grow. However, we believe that the needs of the Group's business will continue to increase in the
future.
As a result, the Company expects to achieve net sales of 21,800 million yen and operating income of 3,100 million
yen in the current fiscal year.
This forecast is based on the assumption that the spread of the new coronavirus infection will not cause a greater
stagnation in the economic activities of domestic companies than the current situation. If this becomes greater in the
future, the Group's operating results may be worse than expected.
In accordance with our existing dividend policy, we will raise the ratio of dividends to net assets, always being
conscious of exceeding the average of all listed companies, while at the same time striving to maintain stabledividends (in principle, dividends per share should not fall below the level of the previous fiscal year). In accordancewith this policy, we forecast a dividend of 15 yen per share for the current fiscal year.

Trends of dividends (adjusted for stock splits)(yen/share)

15.0
13.0
11.0
9.0
7.5
6.0

2018

2019

2020

2021

- 8 -

2022

2023
(Forecast)2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheets(Unit: thousand yen)
Second Quarter of the Fiscal Year
Previous Consolidated Fiscal Yearending June 30, 2023
(June 30, 2022)(December 31, 2022)
AssetsCurrent assets
Cash and deposits
Notes, accounts receivable – trade, and contract
assetsMarketable securities
Work in progress

9,444,021

7,602,605

3,024,049

3,558,419

590,019
18,100500,000
28,086

Raw materials and supplies
Prepaid expenses

82,827
539,637

81,947706,246

Other
Allowance for doubtful accounts

46,346(3,685)

156,478(4,150)13,741,316

12,629,633

398,117

510,438

676,429921,740

521

225

Total intangible assets

676,951

921,966

Investments and other assets
Investment securities

Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
SoftwareOther

511,133

617,395

Long-term prepaid expenses
Leasehold and guarantee deposits

29,713560,883

78,142
681,507

Deferred tax assets
Other

568,997
129,933

368,499
129,933

1,800,661

1,875,477

2,875,730

3,307,882

16,617,046

15,937,516

Total investments and other assets
Total non-current assets
Total assets- 9 -(Unit: thousand yen)
Second Quarter of the Fiscal Year
Previous Consolidated Fiscal Yearending June 30, 2023
(June 30, 2022)(December 31, 2022)
Liabilities
Current liabilities
Notes and accounts payable - trade
Lease obligations

662,316
12,428619,157
12,064

Accounts payable – other, and accrued expenses
Income taxes payable

392,568
586,626

543,419-

Contract obligations
Asset retirement obligations

2,355,344
15,606

2,093,078-

Provision for bonuses
Provision for bonuses to directors and other officers

1,050,315
170,813615,416
75,321

17,743556,7188,495
449,765

5,820,483

4,416,718

18,324
180,576

12,289210,141

Allowance for loss on orders received
Other
Total current liabilities
Non-current liabilities
Lease obligations
Asset retirement obligations
Deferred tax liabilities-

10,024

198,900

232,455

6,019,383

4,649,173

Share capital
Capital surplus

329,128
265,928

345,113
281,913Retained earnings
Treasury shares

9,872,031(608)

10,527,287(608)

Total shareholders' equity

10,466,479

11,153,705

103,126

108,782

236
27,820204
25,649Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustments
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets- 10 -

131,183

134,636

10,597,663

11,288,342

16,617,046

15,937,516

(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive
IncomeConsolidated Quarterly Statements of Income
Second Quarter of the Current Fiscal Year
(Unit: thousand yen)
Second Quarter of the Previous
Second Quarter of the Current
Fiscal Year
Fiscal Year
(From July 1, 2021 to December (From July 1, 2022 to December
31, 2021)
31, 2022)
Net sales
Cost of sales

8,751,335
4,603,233

10,523,013
5,680,573

Gross profit

4,148,102

4,842,439

Selling, general and administrative expenses

2,666,089

3,049,115

Operating profit

1,482,012

1,793,323

122

57
3,200

Non-operating income
Interest income
Dividend income

2,949
1,787

Subsidy income
Miscellaneous income

563
95

Other
Total non-operating income

531
1,517
60

5,517

5,366

403

273

43,559

-

1,133
2,869

2,707
2,843

Foreign exchange loss
Share issuance expenses

855
508

1,574
228

Compensation for damages
Other

647

10,831
289

Total non-operating expenses

49,97818,748

Ordinary profit

1,437,551

1,779,941

Income before income taxes

1,437,551

1,779,941

Income taxes – current
Income taxes – deferred

575,862(3,690)431,800
206,024

Total income taxes

572,171

637,824

Profit865,379

1,142,116

Non-operating expenses
Interest expense
Share of loss of entities accounted for using equity
methodLoss on investments in investment partnerships
Commission expenses

Profit attributable to noncontrolling interests
Profit attributable to owners of the parent- 11 ---

865,379

1,142,116

Consolidated Quarterly Statements of Comprehensive Income
Second Quarter of the Current Fiscal Year

ProfitOther comprehensive income(Unit: thousand yen)
Second Quarter of the Previous
Second Quarter of the Current
Fiscal Year
Fiscal Year
(From July 1, 2021 to December (From July 1, 2022 to December
31, 2021)
31, 2022)
865,379
1,142,116

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

29,173
35

5,655
(31)

Foreign currency translation adjustments
Share of other comprehensive income of affiliates
accounted for by the equity method
Total other comprehensive income

4,878(3,944)

104

1,773

34,192

3,452

Comprehensive income

899,572

1,145,568

Comprehensive income attributable toComprehensive income attributable to owners of theparentComprehensive income attributable to noncontrollinginterests

899,572

1,145,568--- 12 -

(3) Quarterly Consolidated Statements of Cash Flows(Unit: thousand yen)
Second Quarter of the Previous
Second Quarter of the Current
Fiscal Year
Fiscal Year
(From July 1, 2021 to December (From July 1, 2022 to December
31, 2021)
31, 2022)
Cash flows from operating activities
Profit before income taxes

1,437,551

1,779,941

140,9127,724
894(88,251)

203,130
9,637
464(434,899)(72,704)(88,868)(74)(9,248)(3,071)
403
2,869
508

(3,257)
273
2,843
228

43,559-1,133(1,787)

2,707
(531)

Decrease (increase) in notes and accounts
receivable-trade and contract assets(84,358)(534,395)(Increase) decrease in inventories(5,129)(9,105)88,469(43,159)

136,675(142,351)(19,130)(136,592)

Increase (decrease) in contract obligations
Increase (decrease) in deposits received(512,304)
25,137(262,266)
25,770

Other, net(108,387)(201,544)

Subtotal

990,641

158,777

3,067
(403)

3,448
(273)

Amount of subsidies received
Income taxes paid
Net cash provided by (used in) operating activities

1,787(710,250)
284,842531(880,110)(717,626)

Cash flows from investing activities
Proceeds from redemption of marketable securities
Purchase of property, plant and equipment(82,701)

90,019(113,390)

Payments for asset retirement obligations
Purchase of intangible assets(197,311)(269)(375,342)

Purchase of investment securities
Payment of leasehold and guarantee deposits
Proceeds from refund of leasehold and guarantee
deposits
Other, net(11,230)(181,170)(114,152)(120,775)

216,875

151

929

11,657

Net cash provided by (used in) investing activities(254,608)(622,102)

Depreciation
Share-based payment expenses
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for bonuses for
directors (and other officers)
Increase (decrease) in provision for loss on orders
received
Interest and dividend income
Interest expenses
Commission expenses
Share issuance expenses
Share of loss (profit) of entities accounted for using
equity method
Loss (gain) on investments in investment partnerships
Subsidy income

Increase (decrease) in notes and accounts payable - trade
Increase (decrease) in accounts payable and accrued
expenses
Increase (decrease) in accrued consumption taxes

Interest and dividends received
Interest payments- 13 -

(Unit: thousand yen)
Second Quarter of the Previous
Second Quarter of the Current
Fiscal Year
Fiscal Year
(From July 1, 2021 to December (From July 1, 2022 to December
31, 2021)
31, 2022)
Cash flows from financing activities
Repayment of finance lease obligations
Disbursement of commissions paid
Dividends paid
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 14 -(7,073)(6,398)(1,117)(413,602)(508)(422,302)(4,131)(489,092)(228)(499,851)

4,087(3,039)(387,980)
7,786,223
7,398,242(1,842,620)
10,002,870
8,160,250

(4) Notes to Quarterly Consolidated Financial Statements(Notes on the Going Concern Assumption)
Not applicable.
(Notes on Substantial Changes in the Amount of Shareholders' Equity)
Not applicable.
(Changes in Accounting Policies)<Application of the "Guidance on Accounting Standard for Measurement of Fair Value">
The Company adopted the "Guidance on Accounting Standard for Measurement of Fair Value (ASBJ Guidance No.
31, June 17, 2021). Hereafter referred to as the "Guidance on Accounting Standard for Fair Value Calculation")" fromthe beginning of the first quarter of the current consolidated fiscal year and will apply the new accounting policy inaccordance with the transitional treatment stipulated in Paragraph 27-2 of the Guidance on Accounting Standard for
Measurement of Fair Value. There is no impact on the quarterly consolidated financial statements.
(Additional Information)<Application of the "Treatment of Accounting and Disclosure for Application of the Group Totalization System">
Effective from the first quarter of the current fiscal year, the Company and some of its domestic consolidated
subsidiaries have shifted from a consolidated tax payment system to a group totalization system. In accordance withthis change, the accounting treatment and disclosure of income taxes, local income taxes, and tax effect accounting
are in accordance with "Treatment of Accounting and Disclosure for Application of the Group Totalization System(PITF No. 42, August 12, 2021; hereinafter referred to as "PITF No. 42"). In addition, in accordance with Paragraph
32 (1) of the PITF No. 42, the Company has deemed that there is no impact from the change in accounting policy
upon the application of PITF No. 42.
<Accounting estimates related to the spread of new coronavirus infections>
There has been no significant change in the assumptions regarding the impact of the new coronavirus infection
described in (Additional Information) (Accounting Estimates Regarding the Spread of the New Coronavirus
Infection) in the Annual Securities Report for the previous fiscal year.

- 15 -

(Segment Information)
Previous quarter (From July 1, 2021 to December 31, 2021)
1. Information on net sales and profits or losses by reported segment(thousands of yen)Group GovernanceBusiness
Net sales
Sales to customers
Intersegment sales
Total
Segment profit

Reportable segments
DigitalTransformation
Business

4,263,835
16,143
4,279,979
885,6313,355,173
15,6823,370,855
552,488

Outsourcing
Business
1,132,326
333,878
1,466,204
356,607

Total

8,751,335
365,704
9,117,040
1,794,727

2. Difference between the total amount of income (loss) of reportable segments and the amount recorded in thequarterly consolidated statements of income, and major details of said difference (matters related to difference
reconciliation)(thousands of yen)
ProfitAmountReportable segments total
Elimination of transactions between the Company and segments
Corporate expenses (Note)
OthersOperating income in the quarterly consolidated statements of income

1,794,727
373,842(687,076)
519
1,482,012(Note) Corporate expenses are mainly general and administrative expenses not attributable to reportable segments.

Current quarter (From July 1, 2022 to December 31, 2022)
1. Information on net sales and profits or losses by reported segment(thousands of yen)Group GovernanceBusiness
Net sales
Sales to customers
Intersegment sales
Total
Segment profit

Reportable segments
DigitalTransformation
Business

5,122,048
29,304
5,151,353
1,020,066

3,938,740
1,620
3,940,360
718,696

Outsourcing
Business
1,462,223
354,179
1,816,403
418,344

Total

10,523,013
385,103
10,908,117
2,157,107

2. Difference between the total amount of income (loss) of reportable segments and the amount recorded in thequarterly consolidated statements of income, and major details of said difference (matters related to difference
reconciliation)(thousands of yen)
ProfitAmountReportable segments total
Elimination of transactions between the Company and its segments
Corporate expenses (Note)
OthersOperating income in the quarterly consolidated statements of income(Note) Corporate expenses are mainly general and administrative expenses not attributable to reportable segments.

- 16 -

2,157,107
392,372(761,895)
5,738
1,793,323

(Business Combinations, etc.)(Transactions under common control, etc.)
At a meeting of the Board of Directors held on June 22, 2022, the Company's Board of Directors resolved a policyof reorganization (corporate separation among consolidated subsidiaries) of the Group, and on July 15, 2022, DIVACORPORATION, a consolidated subsidiary of the Company agreed that it will succeed to the development businessof consolidated closing support systems (main product brands: "DivaSystem LCA" and "DivaSystem FBX") by wayof an absorption-type company split (hereinafter referred to as "Absorption-Type Company Split No. 1") and ZEALCORPORATION, a consolidated subsidiary of the Company agreed that it will succeed to the business under thejurisdiction of the Corporate Performance Management Unit through an absorption-type company split (hereinafterreferred to as "Absorption-type Company Split No. 2"). These agreements were executed on October 1, 2022.
In conjunction with this reorganization, the trade names of the Company and its consolidated subsidiaries werechanged as follows on October 1, 2022.
After

BeforeAVANT GROUP CORPORATIONAVANT CORPORATIONAVANT CORPORATIONDIVA CORPORATIONDIVA CORPORATIONFIERTE CORPORATION

Absorption-type Split No. 1(1) Outline of the Transaction(i) Name and description of the business subject to the transaction
Development business of consolidated closing support systems (main product brands: "DivaSystem LCA"
and "DivaSystem FBX")(ii) Date of business combination
October 1, 2022(iii) Legal form of business combination
DIVA CORPORATION will be the splitting company and FIERTE CORPORATION will be the successor
company.
(iv) Name of the company after the business combination
DIVA CORPORATIONAVANT CORPORATION(v) Other matters related to the outline of the transaction
In order to realize the materiality of our group, we will accelerate the growth of existing businesses andcreate new growth businesses through reorganization.
(2) Outline of Accounting Procedures Implemented
In accordance with the "Accounting Standard for Business Combinations" and the "Guidance on AccountingStandard for Business Combinations and Accounting Standard for Business Divestitures," the transaction will betreated as a transaction under common control.
2nd Absorption-type Split(1) Outline of the transaction(i) Name and description of the business subject to the transaction
Business under the jurisdiction of Corporate Performance Management Unit(ii) Date of business combination
October 1, 2022(iii) Legal form of business combination
A corporate split in which ZEAL CORPORATION will be the splitting company and DIVACORPORATION will be the successor company- 17 -

(iv) Name of the company after the combination
AVANT CORPORATIONZEAL CORPORATION(v) Other matters related to the outline of the transaction
In order to realize the materiality of our group, we will accelerate the growth of existing businesses andcreate new growth businesses through reorganization.
(2) Outline of Accounting Procedures Implemented
In accordance with the "Accounting Standard for Business Combinations" and the "Guidance on AccountingStandard for Business Combinations and Accounting Standard for Business Divestitures," the transaction will betreated as a transaction under common control.

(Revenue Recognition)
Breakdown of net sales from contracts with customers
Previous quarter (From July 1, 2021 to December 31, 2021)(thousands of yen)Group GovernanceBusiness
Goods or services transferred at a point
in timeGoods or services that are transferredover a period of time
Net sales to external customers

Reportable segments
DigitalTransformation
Business

Outsourcing
Business

Total

230,384

27,62086,649344,655

4,033,451

3,327,552

1,045,677

8,406,680

4,263,835

3,355,173

1,132,326

8,751,335

Current quarter (From July 1, 2022 to December 31, 2022)(thousands of yen)Group GovernanceBusiness
Goods or services transferred at a point
in timeGoods or services that are transferredover a period of time
Net sales to external customers

Reportable segments
DigitalTransformation
Business

Outsourcing
Business

Total

143,959

31,790113,238

288,989

4,978,089

3,906,949

1,348,984

10,234,023

5,122,048

3,938,740

1,462,223

10,523,013- 18 -