UNOFFICIAL TRANSLATION
The formal official document is in Japanese

Summary of Consolidated Financial Results for the First Three Quarters of
Fiscal Year ending September 30, 2021 (Japanese Accounting Standards)
August 6, 2021
Listed Company Name: MTI Ltd.
Listing Exchanges:
Tokyo Stock Exchange
Securities Code9438
URL
https://www.mti.co.jp
Representative:
Toshihiro Maeta, President and Chief Executive Officer
Contact:
Hiroshi Matsumoto, Senior Managing Director
Phone: +81-3-5333-6323
Scheduled date to submit the Quarterly Securities Report (Shihanki Houkokusho): August 13, 2021
Scheduled date of dividend payment: Supplementary documents for quarterly results: Yes
Quarterly results briefing: Yes (for securities analysts and institutional investors(On-demand))(Figures less than one millions of yen are omitted)

1. Consolidated business results for the nine months ended June 30, 2021
(October 1, 2020– June 30, 2021)(1) Consolidated operating results (cumulative total)
Net salesFirst three quarters of fiscal year
ending September 30, 2021
First three quarters of fiscal year
ended September 30, 2020
(Note) Comprehensive income

Operating income

Millions of yen%

19,5040.1

19,492(4.6)

Millions of yen%

Millions of yen%

Millions of yen%

1,796 (11.0)

1,269 (35.3)(1,094)－2,017 (10.9)

1,961 (33.5)

1,780 (17.0)

Nine months ended June 30, 2021: (1,025) millions of yen (－%)
Nine months ended June 30, 2020: 1,425 millions of yen (39.1%)
Net income
per shareFirst three quarters of fiscal year
ending September 30, 2021
First three quarters of fiscal year
ended September 30, 2020

(Percentages represent year-on-year changes)
Profit attributable toOrdinary income
owners of parent

Net income
per share/diluted
Yen

Yen

(20.02)

－

32.58

32.58

(2) Consolidated financial position
Total assets
As of June 30, 2021
As of September 30, 2020
(Reference) Shareholders’ equity:

Net assets

Equity ratio

Millions of yen

Millions of yen%

31,94430,54721,652
21,51055.1
62.7

As of June 30, 2021: 17,605 millions of yen
As of September 30, 2020: 19,166 millions of yen

2. Dividends
Dividend per share
End of firstquarter

End of second
quarter

Yen

Fiscal year ended September 30, 2020－
Fiscal year ending September 30, 2021－
Fiscal year ending
September 30, 2021(forecast)(Note) Revisions to dividend forecasts published most recently: No

End of third
quarterYear end

Annual

Yen

Yen

Yen

Yen

8.00
8.00

－
－

8.00

16.00

8.00

16.00

3. Forecast for consolidated business results for the fiscal year ending September 30, 2021
(October 1, 2020 – September 30, 2021)
Net sales

Full year(Percentages represent year-on-year changes.)
Profit attributable to
Net income
Ordinary income
owners of parent
per share

Operating income

Millions of yen%

25,500〜26,500

(2.2)
〜1.6

Millions of yen%

2,100 (16.2)〜2,500 〜(0.3)

Millions of yen%

Millions of yen

1,600 (23.2)〜2,000 〜(4.0)(1,000)〜(600)%

Yen－(18.27)〜(10.96)(Note) Revisions to forecasts for consolidated business results published most recently: No* Note:(1) Important changes of subsidiaries during the term(changes in specified subsidiaries resulting in change in scope of consolidation): Not applicable
New: –
Exception: –(2) Application of specific accounting treatment to the preparation of quarterly consolidated financial statements: Not

applicable(3) Changes in accounting policies and changes or restatement of accounting estimates(i) Changes in accounting policies due to the modification in accounting methods:(ii) Changes in accounting policies other than (i):(iii) Changes in accounting estimates:(iv) Restatement:

Not applicableNot applicableNot applicableNot applicable(4) Number of outstanding shares (common shares)(i) Number of shares outstanding at the end of period (including treasury shares):6/21: 61,219,100 shares
9/20: 61,144,600 shares(ii) Number of treasury shares at the end of period
6/21: 6,488,680 shares
9/20: 6,511,616 shares(iii) Average number of shares during the period (quarterly consolidated cumulative period)
Nine months ended 6/21: 54,687,183 shares
Nine months ended 6/20 54,644,167 shares* Status of a quarterly review
This earnings release is not subject to an audit.

* Cautionary statement with respect to forward-looking statements
The forward-looking statements included in this material are based on the Company’s judgments, assumptions, andconvictions based on information available to the Company at the time of publication of this document and may differ
materially from actual results for a range of factors, including conditions of Japanese and overseas economies, changes inthe situation of operations in Japan and overseas, and uncertainties and potential risks inherent in forward-looking
statements. The risks and uncertainties include unforeseeable effects of future events. The information on consolidated
earnings forecasts and other future forecasts on page 4 of the Accompanying Materials describes notes on the assumptionsof the earnings forecasts and the use of the earnings forecasts.
While the Company planned to hold a briefing on earnings in the first three quarters chiefly for securities analysts andinstitutional investors on Tuesday, August 10, 2021, to prevent the spread of infections by the COVID-19 coronavirus theCompany will forgo holding at the venue event and will post the on-demand delivery of the briefing and related materials
on its website.

Accompanying materials – Contents
1. Qualitative information on financial results for the current settlement ....................................................................2(1) Explanation on operating results .....................................................................................................................2(2) Explanation on financial position ...................................................................................................................4(3) Explanation of future forecast information including consolidated forecast ..................................................4
2. Quarterly Consolidated financial statements and important notes ......................................................................5(1) Quarterly consolidated balance sheet ...........................................................................................................5(2) Quarterly consolidated statement of income and quarterly consolidated statement ofcomprehensive income ..................................................................................................................................71

1. Qualitative information on financial results for the current quarterly settlement(1) Explanation on operating results overview of the first three quarters of fiscal year ending September 30,
2021 (Period from October 1, 2020 to June 30, 2021)
Looking at the Group's business environment during the first nine months under review, the Japanese economy isseverely affected by the prolonged COVID-19 pandemic. Amid this, its impact on the Group was limited and it
worked on various initiatives in the content business and in the healthcare business with a view towards continued
growth in the future.
In the content business, the Group increased the number of new subscribers to the AdGuard security-related app,which was in high demand, although the acquisition of new subscribers through mobile phone stores remained
weak. It also increased monthly distribution of original comics to digital comic distributors.
In the healthcare business, the Group facilitated collaboration with its partner, Medipal Holdings Corporation, ina bid to spur more pharmacies to introduce the cloud drug record service, given that the appetite for the introductionof this service was growing due to the revision of the Medical Fee System, and to promote sales of child bearingrelated solutions, such as the maternal health record book app, to local governments.
As a result, net sales stood at ¥19,504 million yen (up 0.1% year on year) and gross profit at ¥14,356 million yen(up 1.3% year on year).
Meanwhile, despite the growth in gross profit, operating income was down 11.0% year on year, to ¥1,796 million,
as a result of soaring selling, general and administrative (SG&A) expenses due chiefly to a rise in personnel
expenses and subcontract expenses, as well as an increase in advertising expenses aimed to expand the number ofmembers of AdGuard, a paid security-related app.
Ordinary income decreased 35.3% year on year, to ¥1,269 million, due chiefly to a drop in non-operating
expenses following increase in investment losses by equity method (increased ¥455 million yen year on year)
despite a fall in operating income.
Loss attributable to owners of parent came to -¥1,094 million (compared to a profit of ¥1,780 million in the sameof the previous year). This mainly reflected decreases in ordinary income and extraordinary profit, as well as adecision to post neither deferred tax assets nor income taxes - deferred pursuant to the current accounting standards
for the treatment of consolidated results pertaining to corporate taxes for relevant capital gains as a result of thetransfer of the entire shares of Solamichi System Inc., its consolidated subsidiary of the Company, to CARADA
medica Inc., a consolidated subsidiary of the Company.
Consolidated business results(Period from October 1, 2020 to June 30, 2021)
First three quarters

First three quartersof the fiscal year endingof the fiscal year ended

September 30, 2021

September 30, 2020

ChangeAmountPercentage

Millions of yen

Millions of yen

Millions of yen%

Net sales

19,504

19,492+11+0.1

Cost of sales

5,147

5,315

(167)

(3.2)

Gross profit

14,356

14,177

+179

+1.3

SG&A

12,56012,159+400+3.3

Operating income

1,796

2,017

(221)

(11.0)

Ordinary income

1,269

1,961

(691)

(35.3)

Profit attribute to ownersof parent(1,094)

1,780(2,875)－2

Breakdown of SG&A
(Period from October 1, 2020 to June 30, 2021)
First three quartersof the fiscal year ending
September 30, 2021

First three quartersof the fiscal year ended
September 30, 2020

Millions of yen

Millions of yen

Millions of yen

%

Total

12,56012,159+400+3.3

Advertising expense

1,104

853

+250

+29.4

Personnel expenses

5,251

4,704

+547

+11.6

Commission fee

2,351

2,527

(176)

(7.0)

Subcontract expenses

1,340

1,020

+319

+31.3

846

1,182

(336)

(28.5)

1,666

1,870

(203)

(10.9)

Depreciation
Other

ChangeAmountPercentage

Operating results by segment are as follows.
① Content business
The content business includes B2C monthly billing services excluding the Luna-Luna healthcare service forwomen and the KARADAmedica health Q&A service in cooperation with healthcare professionals, as well as
the B2B original comic distribution business that offers original comic content to comic distributors.
This segment served 3.57 million paying subscribers. The figure was down by 310,000 from the end of
September 2020. The net decrease in paying subscribers continued, but the pace of decrease was gradually
reduced by strong acquisition of new subscriptions to the AdGuard security-related app via mobile phone
stores.
Net sales stood at ¥14,452 million (down 6.1% year on year). Although the original comic distribution
business posted record revenue, it was not enough to offset a year-on-year decrease in the number of paying
subscribers. Operating income also dropped 14.5% year on year to ¥4,839 million, due chiefly to soaring
expenses for advertising the AdGuard security-related app.
② Healthcare business
The healthcare business includes B2C monthly billing services under the Luna-Luna and KARADAmedica
brands and B2B and B2B2C healthcare services for medical institutions and local governments, such as thecloud drug record service, online medical examinations, online medication advice and the maternal health record
book app.
This segment served 660,000 paying subscribers. The figure was 50,000 smaller than at the end of September
2020. It made the most intensive efforts to increase the number of pharmacies introducing the cloud drug record
service. The desire to introduce the service has been increasing due to the revision of the Medical Fee System.
As of the end of June 2021, it had been adopted by 633 pharmacies, up 276 from the end of September 2020.
Net sales came to ¥2,851 million (up 5.8% year on year), after growth in initial introduction sales based on
an increase in the number of pharmacies introducing the cloud drug record service over the same period theprevious year. Operating loss decreased to ¥1,008 million (compared to the loss of ¥1,135 million recorded forthe same period the previous year), aided by an increase sales despite the continuing burden of upfront
investment spending.
③ Other business
Other business includes the B2B fintech business, the AI business operated by consolidated subsidiary AutomagiInc., and the B2B solutions business, which engages in the contracted development of systems and applications.
In this segment, net sales stood at ¥3,113 million (up 44.0% year on year), and operating income at -¥36
million (compared with -¥408 million in the same period a year earlier), following a rise in the sales of the B2B
solutions business and AI business.

3(2) Explanation on financial position① Assets, liabilities and net assets
At the end of the first three quarters under review, total assets increased ¥1,396 million from the end of
September 2020, to ¥31,944 million.
Current assets increased ¥1,474 million mainly due to a rise in cash and deposits. Non-current assets rose ¥78
million chiefly due to a decrease in software, despite a decline in goodwill and customer-related assets.
Current liabilities increased ¥1,499 million, primarily reflecting a rise in income taxes payable. Non-current
liabilities fell ¥244 million mainly due to a declined in long-term liabilities.
Net assets increased ¥141 million yen, mainly reflecting an increase in no-controlling interests, which offset
the dividends paid and the posting of ¥1,094 million as a loss attributable to owners of parent.
(3) Explanation of future forecast information including consolidated forecast
The Company will work hard to expand sales and cut losses of its healthcare business, which is expected to playa key role in increasing revenue and earnings in the future. In the content business, it will make every effort toincrease the number of paying subscribers by expanding sales of the AdGuard security-related app and striving tobolster the original comic distribution business.
The Company takes medium- and long-term perspectives in its engagement in the healthcare business, which
has strong potential for future growth and compared with BtoC transactions, may move toward a more stable
stock-type business through the establishment of long-term business relationships with customers. Therefore, theCompany is committed to implementing a variety of measures to achieve sales growth.
Among others, the cloud drug record service will help the healthcare business attain continuous sales growth,since the appetite for introducing the service has been growing among pharmacies due to the revision of theMedical Fee System. The Company will accelerate sales tie-ups with companies that provide IT solutions topharmacies to make sure that more stores will introduce the service, while simultaneously strengthening
collaboration with its partner, Medipal Holdings Corporation.
If will also take measures to increase paid subscriptions and use rates with respect to online medical
examinations and online medication advice while also enhancing childcare-related services with a focus on local
governments that have introduced the Boshimo the maternal health record book app.
The Company continues to hold its consolidated earnings forecasts for the entirety of the fiscal year as
announced on May 12, 2021.
Earnings forecast for the fiscal year ending September 30, 2020
(Period from October 1, 2020 to September 31, 2021)(Millions of yen)

YoY(%)Net sales

25,500 ~ 26,500(2.2) ~ 1.6

Operating income

2,100 ~ 2,500(16.2) ~ (0.3)

Ordinary income

1,600 ~ 2,000(23.2) ~ (4.0)

Profit attributable toowners of parent(1,000) ~ (600)－42. Quarterly consolidated financial statements and important notes(1) Quarterly consolidated balance sheet(Unit: thousands of yen)Previous fiscal year
(As of September 30, 2020)

Current fiscal year
(As of June 30, 2021)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade

13,354,028
4,840,902

15,336,006
4,361,198

Other
Allowance for doubtful accounts

1,585,024(36,222)

1,556,422(34,977)

Total current assets

19,743,732

21,218,650

193,757

219,211

1,281,608

1,778,546

692,054
1,755,000

613,217
1,439,100

35,43739,275

Total intangible assets

3,764,099

3,870,140

Investments and other assets
Investment securities

4,536,380

4,517,274

Lease and guarantee deposits
Deferred tax assets

493,882
1,766,869

348,549
1,684,200

Other
Allowance for doubtful accounts

74,487(25,824)

112,042(26,024)

Total investment and other assets

6,845,793

6,636,140

10,803,650

10,725,492

30,547,383

31,944,143

Non-current assets
Property plant and equipment
Intangible assets
Software
Goodwill
Customer-related assets
Other

Total non-current assets
Total assets

5

(Unit: thousands of yen)Previous fiscal year
(As of September 30, 2020)

Current fiscal year
(As of June 30, 2021)

Liabilities
Current liabilities
Accounts payable-trade
Current portion of long-term loans payable

1,101,925
451,780

1,088,631
451,780

Accounts payable-other
Income taxes payable

1,333,898
701,022

1,145,977
2,057,281

Provision for bonus
Provision for point usage－110,690

190,770
113,717

Other

1,067,387

1,218,010

Total current liabilities

4,766,705

6,266,169

2,881,570
1,381,767

2,542,735
1,475,888

6,756

7,230

Non-current liabilities
Long-term loans payable
Net defined benefit liability
Other
Total non-current liabilities

4,270,094

4,025,854

9,036,799

10,292,023

Capital stock
Capital surplus

5,138,116
6,551,222

5,184,607
6,647,529

Retained earning
Treasury shares

10,707,058

8,734,517(3,283,663)(3,276,022)

Total shareholders’ equity

19,112,733

17,290,632

19,897

272,002
1,356

Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment(11,666)
46,010Remeasurements of defined benefit plans
Total accumulated other comprehensive income

54,241

Subscription rights to shares

41,662315,021345,299

217,552

Non-controlling interest

1,998,309

3,828,912

Total net assets

21,510,583

21,652,119

30,547,383

31,944,143

Total liabilities and net assets

6

(2) Quarterly consolidated statements of income and quarterly consolidated statement of comprehensive
incomeQuarterly consolidated statement of income
For the first three quarters

Net sales
Cost of sales(Unit: thousands of yen)
For the first three quarters of the For the first three quarters of theprevious fiscal year
current fiscal year
(from October 1, 2019(from October 1, 2020
to June 30, 2020)
to June 30, 2021)
19,492,810
19,504,023
5,315,484
5,147,613

Gross profit

14,177,325

14,356,410

Selling, general and administrative expenses

12,159,741

12,560,021

Operating income

2,017,583

1,796,389

Interest income
Dividend income

117
10,13080

Amortization of negative goodwill
Foreign exchange gains

4,069

－
16,140Non-operating income－
990

Subsidy income
Cancellation of treasury share acquisition rights－

28,43821,424

Other－
18,796

Total non-operating income

34,10393,037

2,215

5,273

66,909521,996

13,6307,654－
92,678Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodForeign exchange losses
Other
Total non-operating expenses
Ordinary income

26,95390,409619,948

1,961,278

1,269,477

272,326－
3,030

Extraordinary income
Gain on step acquisitions
Gain on sale of non-current assets－
422,577

Gain on sale of investment securities
Gain on change in equity

－

3,184
80,082694,904

86,296

Loss on sale of non-current assets
Loss on retirement of non-current assets－
56,6598,217
26,591

Impairment loss
Loss on valuation of investment securities

25,302
1,631

76,94911

Total extraordinary losses

83,593

111,769

Total extraordinary income
Extraordinary losses

Profit before income taxes

2,572,588

1,244,004

Income taxes - current

766,6382,448,114

Income taxes - deferred

127,90782,247

Total income taxes

894,546

2,530,362

Profit (loss)

1,678,042(1,286,358)

Loss attributable to non-controlling interests(102,537)(191,607)

Profit (loss) attributable to owners of parent

1,780,579(1,094,750)

7

Quarterly consolidated statement of comprehensive income
For the first three quarters

Profit (loss)
Other comprehensive income(Unit: thousands of yen)
For the first three quarters of the For the first three quarters of theprevious fiscal year
current fiscal year
(from October 1, 2019(from October 1, 2020
to June 30, 2020)
to June 30, 2021)
1,678,042(1,286,358)

Valuation difference on available-for-sale securities
Foreign currency translation adjustment, before tax(280,633)

222,592(4,198)
4,712

12,167(4,347)

27,79030,334(252,328)

260,748

Comprehensive income

1,425,713(1,025,610)

Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

1,528,251(833,970)(102,537)(191,640)

Remeasurements of defined benefit plans, before tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income8