April 19, 2024

Business Results for the Fiscal Year Ended
March 31, 2024 (FY2024)

Key Financial Results for FY2024◆ Net sales decreased slightly YoY, and gross profit and items below it decreased
significantly◆ A reversal in the performance of the pachinko parlor advertising field was expected at the
beginning of the year, but it has been retreating from the scenario of returning to a growthtrajectory since last October◆ In the pachinko parlor advertising field, demand for online advertising decreased sharply
due to stealth marketing regulation enacted last October, etc.
◆ Advertising fields other than pachinko parlors continued to grow steadily◆ SG&A expenses remained higher YoY mainly due to an increase in personnel expenses asa result of investment in human capital2

Consolidated Earnings Highlights(millions of yen)
FY2020

FY2021

FY2022

FY2023

FY2024

Net Sales

11,115

7,251

7,426

7,545

7,419

(Ref.) Total transactions*11,115

7,251

8,196

8,331

8,331

Operating income

460

-290

296

401

249

Ordinary income

434

-268

313

420

262

31

-310

247

369

125

Net income attributable to parent
company’s shareholders*Total transactions are the gross amount of agent transactions.

Total transactions(millions of yen)
11,115
434

420
313

8,196

8,331

Net income(millions of yen)

Ordinary income(millions of yen)

◆ Transaction volume remained flat

369

262

8,331

247

7,251

125
31

◆ Ordinary income retreated significantly fromthe performance reversal scenario◆ Net income decreased significantly due in partto the reversal of deferred tax assets

(268)
(310)

3

FY2024 Business Performance (YoY)
FY2023
Amount(millions of yen)
YoY comparison

FY2024% of total

Amount% of total

Change% of Change

Net Sales

7,545

100.0%

7,419

100.0%

-126

-1.7%

(Ref.) Total transactions*(8,331)-(8,331)

-

0

0.0%

Gross Profit

2,276

30.2%

2,192

29.5%

-84

-3.7%

Operating income

401

5.3%

249

3.4%

-152

-38.0%

Ordinary income

420

5.6%

262

3.5%

-158

-37.6%Net income attributable to parent
company’s shareholders

369

4.9%

125

1.7%

-243

-66.0%*Total transactions are the gross amount of agent transactions.

> Result◆ Net sales decreased slightly, and gross profit and items below it decreased> Factors◆ Orders in the pachinko parlor advertising field decreased sharply due to the impact of stealth marketing regulation
enacted in October 2023, etc.
◆ An increase in personnel expenses mainly due to an increase in personnel and wages at the beginning of the year
◆ Net income decreased significantly due to lower operating income and the reversal of deferred tax assets4Quarterly Gross Profit and Operating Income (YoY)
Quarterly Gross Profit (millions of yen)
569

582

588

537

587

Quarterly Operating Income (millions of yen)

586
521

498

107

116

127
99

104

41

51

5
1Q

2Q

3Q

4Q

1Q

2Q

FY2023

3Q

4Q

1Q

2Q

3Q
FY2023

FY2024

4Q

1Q

2Q

3Q

4Q

FY2024[Reference] Quarterly SG&A Expenses (millions of yen)
461

467

461

486

488

482

480

493

◆ Gross profit has decreased significantly YoY since the third
quarter◆ SG&A expenses grew due to an increase in personnel andwages at the beginning of the year and other factors

1Q

2Q

3Q

FY2023

4Q

1Q

2Q

3Q

FY20244Q◆ As a result, operating income decreased significantly YoY
5

FY2024 Business Performance (Compared with Forecast)
Revised performance forecast*

FY2024

AmountYoY(millions of yen)
ChangeResultAmountYoY

Amount% of Change

7,500

-0.6%

7,419

-1.7%

-80

-1.1%

Operating income

280-30.3%

249-38.0%-30-11.1%

Ordinary income

280-33.5%

262-37.6%-17-6.2%

Net income attributable to parent
company’s shareholders

180-51.3%

125-66.0%-54-30.1%Net Sales*Revised forecast announced on January 19, 2024

◆ Net Sales, operating income, ordinary income:Slightly below the forecast◆ Net income:Decreased significantly compared with the forecast due to the reversal of deferred
tax assets
6

Breakdown by Business Segment[Cumulative Period]
Advertising
Net Sales
Segment income

Real Estate

Other

Adjusted Amount(millions of yen)
Consolidated

7,342

69

7

－

7,419

504

30

-5

-279

249

[YoY comparison]
Advertising

Real Estate

Other

Adjusted Amount(millions of yen)
Consolidated

Net Sales

-140

+16

-2

－

-126

Segment income

-128

+7

-3

-28

-152

◆

In the advertising business, the pachinko parlor field was very weak◆

The real estate business increased significantly YoY due to brokerage commission revenue◆

Segment profit fell mainly due to a decrease in gross profit and an increase in personnel
expenses7

Segment Income (Advertising)(millions of yen)
YoY comparison

Advertising
FY2023

FY2024

Change% of Change

Net Sales

7,482

7,342

-140

-1.9%

(Ref.) Total transactions*

8,268

8,254

-14

-0.2%

Segment income

632

504

-128

-20.3%*Total transactions are the gross amount of agent transactions.

External Environment >◆ Pachinko parlor facilities:
Orders for influencer advertising dropped sharply due to the impact of stealth marketing regulation enactedin October 2023, etc.
Advertising expenses continued to be curbed to secure investment funds◆ Advertising fields other than pachinko parlors:
Advertising orders remained strong, including mainstay fitness facility advertising and housing-related
advertisingGroup Initiatives >◆ Pursuing the acquisition of new clients in sectors with expected growth in advertising demand8[Reference] Total Quarterly Transactions (Advertising)Advertising: Total Quarterly Transactions (millions of yen)

1,910

1,960

1Q

2Q

2,106

3Q

FY2022

2,150

4Q

2,062

1Q

2,076

2Q

2,090

2,040

3Q

4Q

2,182

1Q

FY2023

2,166

2Q

1,996

3Q

1,910

4Q

FY2024*Total transactions are the gross amount of agent transactions.

◆ The pachinko parlor advertising field was weak
◆ Advertising fields other than pachinko parlors were steady9Sales Breakdown (Advertising)(millions of yen)
FY2023
AmountNewspaper flyers
OnlinePromotional goods
Advertising media
Creative
Other
Total

FY2024
Amount% of total

2,780
2,545
921
215
510
509
7,482

2,448
2,539
999
230
546
577
7,342

37.2%
34.0%
12.3%
2.9%
6.8%
6.8%
100.0%

YoY comparison% of total

Change% of Change

Change in % of total

33.3%

-332

-12.0%-3.9 pt

34.6%

-5

-0.2%

0.6 pt

13.6%

77

8.4%

1.3 pt

3.1%

15

7.2%

0.2 pt

7.4%

36

7.1%

0.6 pt

7.9%

68

13.5%

1.1 pt100.0%

-140

-1.9%

Sales Breakdown (millions of yen)
2,780
2,448

◆ Newspaper flyers remained on a downward
trend

2,545 2,539◆ Growth in online advertising slowed due to a
sharp decline in influencer advertising921

999
510 546509 577

Creative

Other

215 230

Newspaper flyers

OnlinePromotional
goods

Advertising media◆ Promotional goods increased due to theinstallation of next-generation pachinko andslot-machine models
10Total Transaction Breakdown (Advertising)
FY2023
Amount(millions of yen)
ChangeFY2024% of total

Amount% of total

Amount% of Change

Pachinko parlor advertising field

5,018

60.7%

4,769

57.8%

-249

-5.0%

Advertising fields other than pachinko parlors

3,250

39.3%

3,484

42.2%

234

7.2%

Total

8,268

100.0%

8,254

100.0%-14

FY2023

FY2024Advertising fields
other thanpachinko parlors
39.3%

Advertising fields
other thanpachinko parlors
42.2%
Pachinko parlor
advertising field
60.7%

Pachinko parlor
advertising field
57.8%◆ The pachinko parlor advertising field decreased significantly YoY due to a sharp decline in orders
since 2H FY2024◆ Advertising fields other than pachinko parlors remained steady11

Employees(people)End of Mar 2022

End of Mar 2023

End of Mar 2024

YoY Change

155

154

160

6

71

58

55

-3

226

212

215

3

Sales, administration (SG&A)
Creative (cost of sales)
Subtotal for advertising

Advertising: Number of Employees

155

154

160

71

58

55

End of Mar 2022

End of Mar 2023

End of Mar 2024

◆ Sales, administration : An increase in personnel toenhance sales in anticipation ofa recovery in demand◆ Creative : Hiring of new recruits was curbed due todeclining demand for paper-based
advertising12Segment Income (Real Estate)(millions of yen)
YoY comparison

Real Estate
FY2023

FY2024

Change% of Change

Net Sales

53

69

16

30.6%

Operating expense

31

39

8

25.8%

Segment income

22

30

7

36.0%

◆ In addition to rent revenue on the land it owns in Kashiwa, Chiba Prefecture, thesegment recorded ¥17 million in brokerage commission revenue from brokering the saleof a pachinko parlor site
◆ As a result, net sales were ¥69 million (up 30.6% YoY),
and segment income came to ¥30 million (up 36.0% YoY)13

Balance Sheet (Consolidated)
End of Mar 2023

End of Mar 2024

(millions of yen)
Change(A)(B)(B)-(A)

3,735

3,438

-297

Accounts receivable

988

976

-12

Other current assets

122

75

-47

Tangible/intangible fixed assets

714

720

5

Investments and other assets

495

218

-277

6,056

5,428

-628

Accounts payable

555

534

-20

Short-term/long-term borrowings

850

562

-287

59

42

-17

202

203

0

1,667

1,342

-324

4,385

4,080

-305

3

5

2

Total net assets

4,389

4,085

-303

Total liabilities and net assets

6,056

5,428

-628

Cash and cash equivalents

Total assets

Accrued income taxes
Other liabilities
Total liabilities
Shareholders’ equity
Other

Decrease due to purchase of treasury stock, etc.

Decrease due to return of deposits

Decrease due to repayment

・Net income: +¥125 million
・Purchase of treasury stock: -¥218 million
・Dividends: -¥213 million

14

Cash Flow Statement (Consolidated)
FY2023
Net income before income taxes

415(millions of yen)
FY2024265+ Net income before income taxes+ Depreciation and amortization

Cash flow from operations

372

260

+ Change in accounts receivable+ Other

265
54
5
70
- Change in accounts payable

Cash flow from investing activities-86- Income taxes paid

156

Cash flow from financing activities

-546

-719

Cash and cash equivalents at end of period

3,729

3,431

- Other
Cash flow from operations

260+ Proceeds due to return of deposits

176
49
9

+ Proceeds from sale and redemption of investment securities+ Other earnings- Payment for purchase of tangible/intangible assets- Other
Cash flow from investing activities

20
98
17

76
1

156

- Repayment of borrowings- Payment for purchase of treasury stock- Dividends paid
Cash flow from financing activities

287
218
213
719

15

FY2025 Consolidated Earnings Forecast(millions of yen)

FY2024 result

FY2025 forecast

(%)

7,419

7,500

1.1%

Operating income

249

300

20.5%

Ordinary income

262

300

14.3%

Net income attributable to parent
company’s shareholders

125

220

74.8%

Net Sales◆ Pachinko parlor advertising field・ “Advertising and Promotion Guidelines” issued by four pachinko industry groups have clarified
the contents of advertising regulations
・ Developing and offering advertising and services that contribute to attracting customers=> Improvement in profitability◆ Advertising fields other than pachinko parlors=> Promote the acquisition of clients in sectors with promising demand◆ Plan to increase sales and profits compared with FY2024
16

Challenges Ahead◆ Pursuing sustainable growth under the new structure
・ Shifted to a new management structure, including a change of Representative Director, in order to adapt tochanges in the surrounding business environment and make prompt and appropriate management decisions
and promote decision results
・ Under the new structure, create a corporate culture that dispels existing stereotypes and takes onchallenges
・ Continue to actively promote the next-generation of talented people who will be in charge of the Group’s
future as senior management◆ Improving the profitability of pachinko parlor advertising
・ Develop and offer advertising and services that contribute to attracting customers, pursuant to the“Advertising and Promotion Guidelines Ver. 2”
・ Create demand by reactivating dormant clients・ Consolidate sales bases and optimize costs with the aim of improving productivity◆ Pursuing the acquisition of clients in sectors with expected growth in demand
・ Further expand sales for and deepen transactions with tutoring schools, secondhand shop businesses,
public professional sports, etc., in addition to the mainstay fitness facility and housing-related fields

17Shareholder Returns
FY2023
Consolidated EPS

FY2024FY2025 forecast

yen

27.85

10.17

17.89
20.00

Annual dividends

yen

15.00

18.00

(of which, interim dividend)yen(7.00)(9.00)(10.00)

Dividend payout ratio

%

53.9%

177.0%

111.8%DOE (Dividend on equity ratio) %

3.4%

5.2%

About 6.0%

Total dividend amount*1

148

213

246

310

218

-

900,000

499,700-

12,799,700

12,300,000

12,300,000

millions of yen*1 Total div idend amount is the amount paid during the period

Amount of treasury stock purchased
millions of yen
during the period
Number of treasury stock purchased during
sharesthe period
Total number of shares issued at the end of
sharesthe period*2*2 Total number of shares issued at the end of the period excludes the number of treasury stocks not y et retired.

[Changes in the Basic Policy on Shareholder Returns]
・Target dividend payout ratio had been 50%
・Added a new target of DOE of around 6%
・Pay dividends in an amount as determined based on the higher of DOE of 6% and dividend payout ratio of 50%
・Focus on improving capital efficiency and purchase treasury stock at the right time
◆ Shareholder returns for FY2024
・Dividends at the end of Mar 2024: ¥9 (¥18 annually) DOE: 5.2% Dividend payout ratio: 177.0%
・Total amount of treasury stock purchased for FY2024: ¥218 million◆ Dividend forecast for next fiscal year (FY2025): ¥20 annually

DOE forecast: About 6.0%
18

Change of Representative Director◆ We tentatively decided on a change of Representative Director at the Board of Directors
meeting held on April 19, 2024, as follows. This change is planned to be formally decided atthe 29th Annual General Meeting of Shareholders and the Board of Directors meetingscheduled to be held on June 21, 2024.
1. Details of the change (scheduled to take effect on June 21, 2024)
New Representative Director
New title

Current title

Name

Representative Director and CEO

Director and CMO

Katsutoshi Oshima

New title

Current title

Name

Director

Representative Director and CEO

Masataka Yamamoto

Retiring Representative Director(Note) Current Representative Director and COO Yuzuru Kamikawana is planned to be reappointed as Representative Director and COO.

◆ Reason for the change:
To adapt to changes in the business environment surrounding the Group and make prompt
and appropriate management decisions and act on decisions, under the new structure.
19

These materials, which contain earnings forecasts and other forwardlooking statements, are based on information available to the Company
at the time of preparation and on certain other information the Company
believes to be reasonable. Actual business results may differ materiallyfrom those expressed or implied herein due to a range of factors.
Investor relations contact:
URL. https://www.gendai-a.co.jp/ir/contact/index.php

Tel. 03-5358-3334

20