Note:

This document has been translated from the Japanese original for reference purposes only. In the event of any
discrepancy between this translated document and the Japanese original, the original shall prevail.

October 15, 2019

Financial Results for FY2019 Q1
Company name:
Sansan, Inc.
Listing:
Tokyo Stock Exchange
Securities code:
4443
URL:
https://www.corp-sansan.com/
Representative:
Chikahiro Terada, Representative Director & CEO
Inquiries:
Muneyuki Hashimoto, Executive Officer, CFO
TEL:+81-3-6758-0033
Scheduled date to file quarterly securities report:
October 15, 2019
Scheduled date to commence dividend payment:–
Preparation of supplementary materials on financial results:
Yes
Holding of financial results meeting:Yes (for institutional investors andanalysts)(Millions of yen with fractional amounts rounded down, unless otherwise noted)

1. Consolidated financial results for the first three months of the fiscal year ending May 31, 2020
(from June 1, 2019 to August 31, 2019)(1) Consolidated operating results (cumulative)
Net sales
Three months ended
August 31, 2019
August 31, 2018

Three months ended
August 31, 2019
August 31, 2018

Operating profit

Millions of yen% Millions of yen

3,100
–

Note: Comprehensive income(Percentages indicate year-on-year changes.)

–
–

248
–

% Millions of yen––

Three months ended August 31, 2019:
Three months ended August 31, 2018:

Basic earnings per
share

Diluted earnings
per share

Yen

Yen

3.50
–

3.45
–

Profit attributable toowners of parent

Ordinary profit

192–% Millions of yen

–
–

106
–

%

–
–

¥100 million [–%]
¥ – million [–%]

Note: As the Company has not prepared consolidated financial statements for the three months ended August 31, 2018, thefinancial figures and the percentage indicating year-on-year changes are not shown for the three months ended
August 31, 2018 and the percentage indicating year-on-year changes is not shown for the three months ended August
31, 2019.

(2) Consolidated financial position
Total assets
As ofAugust 31, 2019
May 31, 2019
Reference:

Net assets

Equity-to-asset ratio

Millions of yen

Millions of yen%

16,578
9,079

10,316
3,372

62.2
37.0

EquityAs of August 31, 2019:
As of May 31, 2019:¥10,305 million¥3,362 million

2. Cash dividends
Annual dividends
First quarter-end

Second quarter-end Third quarter-end

Yen

Fiscal year ended
May 31, 2019
Fiscal year ending
May 31, 2020

Yen–

Fiscal year-end

Yen

0.00

–

Total

Yen

Yen

0.00

0.00

–

–

–

Fiscal year ending
May 31, 2020––
(Forecast)
Note: Revisions to the forecast of cash dividends most recently announced: None

3. Consolidated earnings forecasts for the fiscal year ending May 31, 2020 (from June 1, 2019 to
May 31, 2020)
Net sales

Fiscal year ending
May 31, 2020

(Percentages indicate year-on-year changes.)
Basic
Profit attributable toOrdinary profit
earnings perowners of parent
share

Operating profit

Millions ofyen%Millions ofyen

13,816

35.4

724

%

–

Millions of
yen

670

%

–

Millions of
yen

–

%

–

Yen

–

Notes: 1. Revisions to the earnings forecasts most recently announced: None
2. Although the Company is expecting to return to the black and post a profit attributable to owners of parent, it isdifficult to make a precise forecast. Accordingly, the Company will refrain from disclosing a concrete forecast at
this point in time.

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in thechange in scope of consolidation): None
(2) Application of specific accounting for preparing the quarterly consolidated financial statements: None
(3) Changes in accounting policies, changes in accounting estimates, and restatementa. Changes in accounting policies due to revisions to accounting standards and other regulations:Noneb. Changes in accounting policies due to other reasons: Nonec. Changes in accounting estimates: None
d. Restatement: None
(4) Number of issued shares (Common shares)
a. Total number of issued shares at the end of the period (including treasury shares)
As of August 31, 2019

31,058,853 shares

As of May 31, 201929,432,353 sharesb. Number of treasury shares at the end of the period
As of August 31, 2019–

As of May 31, 2019–c. Average number of outstanding shares during the period
For the three months ended August 31, 201930,397,777 shares

For the three months ended August 31, 2018–

Note: As the Company has not prepared consolidated financial statements for the three months ended August 31,
2018, the average number of outstanding shares during the period for the three months ended August 31,
2018 is not shown.

* Quarterly financial results reports are exempt from quarterly review conducted by certified public
accountants or an audit corporation.
* Proper use of earnings forecasts, and other special matters
Forward-looking statements, including the consolidated forecasts stated in these materials, are based on
information currently available to the Company and certain assumptions deemed reasonable. Results
may differ materially from the consolidated forecasts due to various factors.

Attached Material
Index
1. Qualitative information on quarterly consolidated financial results ......................................................... 2(1) Explanation of operating results ............................................................................................................ 2(2) Explanation of financial position ........................................................................................................... 4(3) Explanation of consolidated earnings forecasts and other forward-looking statements ........................ 4
2. Quarterly consolidated financial statements and significant notes thereto ............................................... 5(1) Quarterly consolidated balance sheet .................................................................................................... 5(2) Quarterly consolidated statements of income and comprehensive income ........................................... 7
Quarterly consolidated statement of income ......................................................................................... 7
Quarterly consolidated statement of comprehensive income ................................................................ 8(3) Notes to the quarterly consolidated financial statements ....................................................................... 9(Notes on premise of going concern)..................................................................................................... 9(Notes on significant changes in the amount of shareholders’ equity) .................................................. 9(Segment information, etc.) ................................................................................................................... 9- 1 -1. Qualitative information on quarterly consolidated financial results(1) Explanation of operating results
Under the mission of “Turning encounters into innovation,” the Group is developing services tied tosolving various issues that companies and business people face, such as business card management, byusing new approaches that combine “technology and data-input-based business card digitization
systems” with “cloud software.” Specifically, the Group operates the Sansan Business, which provides“Sansan,” a B2B cloud-based business card management service that enables users to digitize businesscards in order to visualize and share the networks between individuals, and the Eight Business, which
operates “Eight”: Your Business Card Management App that incorporates a system of social
networking services and changes business cards into a business network. In addition, the DSOC (Data
Strategy & Operation Center), which serves as Data Integration Division, takes on the job of digitizing
business cards as both business’s shared infrastructure. The DSOC continues to pursue improvement in
new technology development and data-input operations. The “Sansan” and “Eight” Businesses that theGroup provides are services used by many companies and business people, and business cardmanagement, which is a basic business need, and the data and information collected form the backboneof those services. Therefore, we believe that there is high potential for syncing with other services anddatabases and that all the requirements are there for a business platform. Accordingly, by increasing thevalue of these two businesses as a business platform, we believe they have the special characteristic ofproviding easy access to various business opportunities.
In the first three months of the fiscal year ending May 31, 2020, the Company engaged in initiatives
such as strengthening the sales structure, including human resources, in order to realize continuous
growth of net sales.
As a result, the Sansan Business and the Eight Business have performed steadily, and net sales totaled¥3,100,589 thousand, gross profit totaled ¥2,636,446 thousand, and gross profit margin was 85.0% in
the period under review. In addition, for multi-step profit or loss under operating profit or loss, thecontinuation of net sales growth led the Company to record operating profit of ¥248,926 thousand,ordinary profit of ¥192,705 thousand and profit attributable to owners of parent of ¥106,356 thousand.
Furthermore, as a result of the Company issuing a public offering of shares by original placement and asecondary offering of shares by an overallotment to a third party through newly listing on the Tokyo
Stock Exchange Mothers on June 19, 2019, the Company has increased its capital through an allotmentof new shares. The Company plans to use the ¥6,843,498 thousand in proceeds as working capital bymaking marketing investments such as advertising expenses and sales promotion expenses, personnel
expenses, and recruiting expenses.
Results by segment are as follows.
(i) Sansan BusinessIn the Sansan Business, the Company develops “Sansan,” the B2B cloud-based business cardmanagement service, based on the concept of “Sansan, Where Business Starts.” By using “Sansan”
to solve various issues faced by companies, such as “information on the exchange of business cards
is not shared within the company” and “we don’t think about the value held by business card
information,” and change the business cards with dormant potential in the company into an asset
that can be used through business activities, we believe we are able to maximize the value ofbusiness “encounters.” Simply by having the user companies scan their business cards, it becomes
possible to accurately digitize the business card information using data input operators, etc. of theGroup and of external information processing partners and use “AI Contact Management” throughthe cloud-based applications. With these features, not only can individual employees manage theirbusiness cards, it also becomes possible to share Contact Data throughout the organization.
Furthermore, Sansan provides a broad range of customer management tools, such as the
distribution of news on personnel changes to inform people of the latest personnel information andthe ability to send batch emails.

- 2 -Furthermore, in addition to these basic functions, we also provide “Collaboration with Colleagues”
with a feature that provides access to in-house address books, thereby facilitating the smoothsharing of information among co-workers, and a feature that enables visualization of in-housestrengths and knowledge, and “Customer Data Hub,” which enables syncing with in-house
databases and advanced aggregation of complex customer data. Through the ability to quickly
access the cloud-based Contact Data from PCs or smartphones and the ability to utilize thefunctions to search such data and use call/messaging functions, etc., business people are able torealize improvements in productivity, general office operations, and cost cutting benefits.
Moreover, we believe that the ability to share Contact Data inside the organization, aggregate thecustomer data existing inside the company and other such benefits will give shape to advanced
marketing activities, customer management, and the like that will lead to the creation of business
opportunities for the user company.
As a business model, the Company is pursuing a monthly fee for licenses on the premise of all staff
members in the user company using the service (company-wide use). The monthly usage fee iscalculated by the usage fees of the optional functions, scanner rental fees, etc. being added to thelicense cost, which is calculated based on the number of business cards that are digitized in the user
company. In addition, at the time the service is being introduced, additional paid services areprovided relating to the digitization of the existing large volumes of paper-format business cards
retained by the user company, activities to support introduction, etc.
For the period under review, the Company continued to engage in initiatives such as strengthening
the sales structure, including hiring of salespeople, in order to further increase the number ofsubscriptions and increase monthly sales per subscription for “Sansan,” a B2B cloud-based
business card management service. As a result, in addition to progress in the use of our services bylarge corporate clients, including financial institutions, the Company has also steadily acquired newcustomers among medium to small enterprises. At the end of the period under review, the numberof “Sansan” subscriptions totaled 6,032, up 12.5% year on year. Furthermore, as a result of carryingout ongoing initiatives to expand use among existing customers to achieve a stronger customer
foundation, the last 12 months average of monthly churn rate (Note 1.) was 0.63%, an
improvement of 0.13 points year on year.
As a result, net sales totaled ¥2,848,779 thousand and segment profit totaled ¥1,264,121 thousandin the period under review.
Note 1. Ratio of decrease in monthly fees associated with subscription cancellations to totalmonthly fees for existing subscriptions for “Sansan.”(ii) Eight BusinessIn the Eight Business, the Company operates the business card application “Eight” as the new
business network service that goes beyond pure business card management to incorporate a systemof social networking services based on the concept of “Business-Focused SNS Connected with
Business Cards.”
We believe that through using “Eight,” it will be possible to resolve issues that business people
struggle with such as “I’m not making use of my business encounters” and “I cannot easily accessmy business card information.”“Eight,” like “Sansan,” is a service whereby the business card information of the user and theircontacts are accurately digitized simply through scanning the business cards. In the case of “Eight,”
first, by registering their own business card, the user creates their own page, which they can use
throughout their business life, and on that page, they are able to manage their profile. Next, byregistering the business cards of their contacts, the user is able to make use of the business cardmanagement functions, and all the Contact Data that has been converted to cloud-based data can beaccessed at any time from either a smartphone or a PC. Furthermore, when the information of acontact who is connected through the networking service changes, the most recent information will
be automatically updated in the registered Contact Data, and the user will be notified of thischange. Users are also able to use a messaging function for business chats, and they are able to- 3 -more smoothly utilize their own personal business networks. Users can also use the service forcollecting corporate information that interests them and performing job searching activities.
As a business model, the Company bases the business on the application that enables users to use
the profile management and business card management features at no cost. On top of this, theCompany provides the B2C services, “Eight Premium,” for individuals who want access to extra
user functions and the B2B services such as “Eight Company Premium,” a service that allows thesharing of business cards registered on “Eight” within a company, “Eight Ads,” a service thatenables advertisements to be disseminated to “Eight” users, and “Eight Career Design,” arecruitment related service that enables hiring companies (corporate client users) to approach job
seekers (individual users) on the job search platform.
In the period under review, the Company worked on strengthening monetization through “Eight
Company Premium,” the B2B service, and other methods in “Eight,” the B2C Business Card
Management App. As a result, the number of “Eight Company Premium” subscriptions underreview totaled 991, an increase of 222.8% year on year and the number of “Eight” users (Note 2.)
totaled 2.51 million, an increase of 0.29 million year on year at the end of the period under review.
As a result, net sales for the period under review totaled ¥251,810 thousand, of which net sales
from B2C services totaled ¥72,131 thousand and net sales from B2B services totaled ¥179,679
thousand. Although segment loss was recorded at ¥239,146 thousand due to being in the phase inwhich upfront investments were being made to increase future profitability, losses decreased basedon ongoing growth of net sales and the strengthening of monetization.
Note 2. Number of confirmed users that downloaded the application and registered their own
business cards.
(2) Explanation of financial position
AssetsTotal assets at the end of the period under review were ¥16,578,424 thousand, up ¥7,499,307 thousand
from the end of the previous fiscal year. This was primarily due to an increase of ¥7,407,152 thousandin cash and deposits.
Liabilities
Total liabilities at the end of the period under review were ¥6,261,878 thousand, up ¥555,727 thousand
from the end of the previous fiscal year. This was primarily due to an increase of ¥623,546 thousand inadvances received from receiving a lump-sum payment of contract term fees from customers.
Net assets
Net assets at the end of the period under review were ¥10,316,545 thousand, up ¥6,943,580 thousand
from the end of the previous fiscal year. This was primarily due to increases of ¥3,421,749 thousand ineach of share capital and capital surplus from issuing new shares in association with the listing of theCompany’s common shares on the Tokyo Stock Exchange Mothers, and an increase of ¥106,356
thousand in retained earnings due to recording of profit attributable to owners of parent. In addition, theCompany reduced capital surplus by ¥947,106 thousand and transferred them to retained earnings inorder to achieve future flexible and dynamic capital policy by eliminating cumulative loss early basedon the resolution at the meeting of the Board of Directors that took place on July 30, 2019.
(3) Explanation of consolidated earnings forecasts and other forward-looking statements
The forecasts of consolidated financial results for the fiscal year ending May 31, 2020 have notchanged from the forecast announced on July 12, 2019. Note that because there were no large
advertising activities carried out for the Sansan Business in the period under review, the progress rate
for achieving the targeted operating profit has become high, but the results are in line with the initial
targets. In the second and later quarters, the Company plans to aggressively undertake advertising
activities.

- 4 -2. Quarterly consolidated financial statements and significant notes thereto(1) Quarterly consolidated balance sheet(Thousands of yen)
As of May 31, 2019
AssetsCurrent assets
Cash and deposits
Accounts receivable - trade
Prepaid expenses
Consumption taxes receivable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Software
Other
Total intangible assets
Investments and other assets
Investment securities
Leasehold deposits
Other
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable - trade
Short-term borrowings
Current portion of long-term borrowings
Accounts payable - other
Income taxes payable
Accrued consumption taxes
Advances received
Provision for bonuses
Provision for loss on closure of business locations
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Other
Total non-current liabilities
Total liabilities- 5 -As of August 31, 2019

5,627,035
318,354322,660
266
32,996(2,704)
6,298,608

13,034,187
264,547
381,292
393
33,102(2,768)13,710,755

406,924

460,495

834,737390
835,127

857,290357
857,648

1,093,800
439,537
5,118
1,538,455
2,780,508
9,079,116

1,119,562
425,410
4,551
1,549,524
2,867,668
16,578,424

96,16918,000133,134
770,424
41,283
184,745
3,923,177
199,0106,960
55,8685,428,772

73,742
84,666
155,448
738,984
73,911
110,6094,546,723
123,796
3,669
129,485
6,041,037

233,71443,664
277,378
5,706,151

182,360
38,481
220,841
6,261,878

(Thousands of yen)
As of May 31, 2019
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Total shareholders’ equity
Accumulated other comprehensive income
Foreign currency translation adjustment
Total accumulated other comprehensive income
Share acquisition rights
Total net assets
Total liabilities and net assets- 6 -As of August 31, 2019

2,812,501
1,500,000(942,592)
3,369,909

6,234,250
3,974,643
110,870
10,319,764(7,607)(7,607)
10,663
3,372,965
9,079,116(13,882)(13,882)
10,663
10,316,545
16,578,424

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income(Thousands of yen)Three months ended
August 31, 2019
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest and dividend income
Foreign exchange gains
Cancellation penalty income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Share issuance cost
Stock market listing expenses
Share of loss of entities accounted for using equity
methodOther
Total non-operating expenses
Ordinary profit
Extraordinary losses
Loss on retirement of non-current assets
Impairment loss
Total extraordinary losses
Profit before income taxes
Income taxes - current
ProfitProfit attributable to owners of parent

3,100,589
464,1432,636,446
2,387,520
248,926
592
568
476
455
2,093
1,161
28,102
13,877
13,592
1,579
58,313
192,705
4,293
37,854
42,147
150,558
44,201
106,356
106,356- 7 -Quarterly consolidated statement of comprehensive income(Thousands of yen)Three months ended
August 31, 2019
ProfitOther comprehensive income
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparent106,356(6,274)(6,274)
100,082
100,082- 8 -(3) Notes to the quarterly consolidated financial statements(Notes on premise of going concern)
Not applicable.
(Notes on significant changes in the amount of shareholders’ equity)
The share capital and the capital surplus both received an addition of ¥3,421,749 thousand due to the
new issuance of shares in association with the listing of the Company’s common shares on the Tokyo
Stock Exchange Mothers. On the other hand, as a result of deducting the amount of ¥947,106 thousandof capital surplus and transferring it to retained earnings in order to eliminate cumulative loss, the sharecapital, capital surplus and retained earnings were ¥6,234,250 thousand, ¥3,974,643 thousand, and¥110,870 thousand, respectively.
(Segment information, etc.)[Segment information]
First three months of the fiscal year ending May 31, 2020 (from June 1, 2019 to August 31, 2019)
1. Information on the amount of sales and profit (loss) for each reportable segment(Thousands of yen)Amount in thequarterly
Adjustments
consolidated(Note) 1
financialstatement(Note) 2

Reportable segment
SansanBusiness
Net sales
Sales to external customers
Inter-segment sales andtransfers

Eight Business

Total

2,848,779

251,810

3,100,589–

3,100,589

–

–

–

–

–

Total

2,848,779

251,810

3,100,589–

3,100,589

Segment profit (loss)

1,264,121(239,146)

1,024,975(776,049)

248,926

Notes: 1. The adjustments stated for segment profit (loss) of negative ¥776,049 thousand comprises the amounts ofcorporate expenses not attributable to any reportable segment and mostly consists of general and administrative
expenses.
2. Segment profit (loss) is adjusted with operating profit in the quarterly consolidated statement of income.

2. Information on impairment loss of non-current assets or goodwill, etc. for each reportablesegment(Significant impairment loss on non-current assets)
As corporate expenses not belonging to the Sansan Business, Eight Business and any reportablesegment, the Company reduced the carrying amounts for software to their recoverable amounts
and recorded the amounts of reduction in impairment loss.
The relevant amounts recorded in impairment loss for the three months ended August 31, 2019were ¥6,387 thousand for the Sansan Business, ¥9,648 thousand for the Eight Business and¥21,818 thousand for corporate expenses not belonging to any reportable segment.

- 9 -