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.

January 11, 2024

Consolidated Financial Results
for the Three Months Ended November 30, 2023
(Under Japanese GAAP)
Company name:
TRANSACTION CO., Ltd.
Listing:
Tokyo Stock Exchange
Securities code:
7818
URL:
http://www.trans-action.co.jp.e.zy.hp.transer.com/
Representative:
Satoshi Ishikawa, Chairman and Representative Director
Inquiries:
Yoshinari Kitayama, Director
Telephone:+81-3-6861-5577
Scheduled date to file quarterly securities report:
January 12, 2024
Scheduled date to commence dividend payments:–
Preparation of supplementary material on quarterly financial results:
None
Holding of quarterly financial results briefing:
None(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated financial results for the three months ended November 30, 2023 (from September 1,
2023 to November 30, 2023)(1) Consolidated operating results(Percentages indicate year-on-year changes.)

Net sales

Operating profit

Three months ended

Millions of yen

November 30, 2023

6,624

11.0

1,487

17.9

1,518

20.9

1,002

22.5

November 30, 2022

5,969

33.9

1,262

60.3

1,255

59.2

818

57.3

Note: Comprehensive income% Millions of yen

Profit attributable toowners of parent

Ordinary profit% Millions of yen

For the three months ended November 30, 2023:
For the three months ended November 30, 2022:

Basic earnings
per share% Millions of yen¥933 million¥719 million[29.7%][22.9%]

Diluted earnings
per share

Three months ended

Yen

November 30, 2023

34.43

–

November 30, 2022

28.12

–

Yen

(2) Consolidated financial position
Total assets
As of

Net assets

Equity-to-asset ratio

Millions of yen

Millions of yen

November 30, 2023

19,671

16,15082.1

August 31, 2023

20,59916,236

78.8

Reference:

EquityAs of November 30, 2023:
As of August 31, 2023:¥16,150 million¥16,236 million%%

2. Cash dividends
Annual dividends per shareFirst quarter-end

Second quarterend

Third quarter-end

Yen

Yen

Yen

Fiscal year ended

–

Total
Yen

Yen

–

35.00

35.00

0.00
–
August 31, 2024 (Forecast)
Note: Revisions to the forecasts of cash dividends most recently announced: None

37.00

37.00

August 31, 2023
Fiscal year ending

0.00

Fiscalyear-end–

August 31, 2024
Fiscal year ending

3. Consolidated earnings forecasts for the fiscal year ending August 31, 2024 (from September 1,
2023 to August 31, 2024)
Net sales
Millions ofyen(Percentages indicate year-on-year changes.)
Profit attributable to Basic earnings per
Ordinary profit
owners of parent
share

Operating profit%

Millions ofyen%Millions ofyen%

Six months ending
8.9
2,577
11.0
2,634
11.7
12,278February 29, 2024
Fiscal year ending
25,160
9.6
5,220
12.1
5,329
11.3
August 31, 2024
Note: Revisions to the consolidated earnings forecasts most recently announced: None

Millions of
yen

%

Yen

1,732

11.1

59.48

3,501

5.9

120.20* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in thechange in scope of consolidation): None
(2) Application of special accounting treatments for the preparation of quarterly consolidated financial
statements: None
(3) Changes in accounting policies, changes in accounting estimates, and restatement(i) Changes in accounting policies due to revisions to accounting standards and other regulations:None(ii) Changes in accounting policies due to other reasons: None(iii) Changes in accounting estimates: None(iv) Restatement: None
(4) Number of issued shares (common shares)(i)

Total number of issued shares at the end of the period (including treasury shares)
As of November 30, 2023

29,375,400 shares

As of August 31, 2023

29,375,400 shares(ii) Number of treasury shares at the end of the period
As of November 30, 2023

246,865 shares

As of August 31, 2023

246,865 shares(iii) Average number of shares outstanding during the period
Three months ended November 30, 2023

29,128,535 shares

Three months ended November 30, 2022

29,104,535 shares* 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
The financial forecast and other forward-looking statements in this material are based on information
currently available to the Company and certain preconditions considered to be reasonable. Actual
performance, etc. may vary depending on various factors. For the preconditions on which the earnings
forecast is based and notes, etc. for using the earnings forecast, please refer to “(3) Explanation of
consolidated earnings forecasts and other forward-looking statements” in “1. Qualitative Information on
Quarterly Financial Results” on page 5 of the Quarterly Financial Results (attached file).

[Attached Material]
Index
1. Qualitative Information on Quarterly Financial Results ........................................................................... 2(1) Explanation of operating results ......................................................................................................... 2(2) Explanation of financial position........................................................................................................ 5(3) Explanation of consolidated earnings forecasts and other forward-looking statements ..................... 5
2. Quarterly Consolidated Financial Statements and Major Notes ............................................................... 6(1) Quarterly Consolidated Balance Sheet ............................................................................................... 6(2) Quarterly Consolidated Statement of Income and Consolidated Statement of Comprehensive Income............................................................................................................................................................ 8
Quarterly Consolidated Statement of Income (Cumulative) .............................................................. 8
Quarterly Consolidated Statement of Comprehensive Income (Cumulative) .................................... 9(3) Notes to Quarterly Consolidated Financial Statements .................................................................... 10
Notes regarding assumption of a going concern .............................................................................. 10
Notes on significant changes in the amount of shareholders’ equity ................................................ 10
Subsequent events ............................................................................................................................ 10-1-

1. Qualitative Information on Quarterly Financial Results(1) Explanation of operating results
During the first three months ended November 30, 2023, the Japanese economy showed signs ofrecovery mainly due to improvements in the employment and income environment and recovery of
inbound demand. Meanwhile, future uncertainty continued to persist due to such factors as thesituations concerning Russia/Ukraine and the Middle East, and fluctuations in financial and capital
markets due to indications of a shift from deflation to inflation.
In this environment, the TRANSACTION Group (the “Group”) reviewed the priorities of the five key
strategies designated in the 4th medium-term management plan, and during the period under review,
with a focused on “strengthened e-commerce” the Group promoted “finished goods demand arisingfrom the promotion of SDGs,” “finished goods demand arising from reopening,” “tangible goods
consumption derived from intangible goods consumption,” and “strengthened domestic in-housemanufacturing.” While promoting such key strategies and ensuring changes in the social environmentand consumption trends were identified in a timely and appropriate manner, the Group worked on the
introduction of new products, the development of client entities, and the strengthening of relationships.
 Unique business model
The Group’s unique business model is based on the ability to plan and propose products in a shortperiod of time based on unprecedented ideas, such as “things that are convenient to have,” “things that
anticipate trends,” and “necessary things that are not in the market (or are lacking),” the ability to
produce and procure products in bulk at low cost and in plain form through overseas suppliers and holdthem in Japan, and the ability to add high-quality added-value to these plain products through printing
and processing, and offer them at low prices and with short delivery times regardless of the quantity. In
addition, by improving the efficiency of the entire process through e-commerce, we differentiate
ourselves from our competitors and develop our business. In our unique business model, we provide
the “MARKLESS Connect*” system, which was developed aiming to strengthen the e-commercebusiness, to client companies in order to effectively increase the performance of both the Group and its
client companies by eliminating waste of their order receiving and placing operations and improving
the efficiency of business process.
*This is a system that allows us to complete all transactions with client entities, such as checking theinventory status of our products (stock quantity, out-of-stock items, and next delivery date), order
receipt and placement, design submission, and payment, through e-commerce, thereby improving
efficiency without human intervention.

 E-commerce businessIn the E-commerce business, in accordance with the key strategy of “strengthened e-commerce,” wereinforced initiatives to increase sales of B2B and D2C* sites, with the target of having those sales
account for at least 30% of consolidated net sales in the fiscal year ending August 31, 2025. The ecommerce platform built by the Group automates a series of interactions, such as confirming real-timeinventory information and receiving and placing orders, thereby reducing human involvement. Not
only has this system increased sales, productivity, and efficiency for the Group, but it has also beenequally effective for our client entities. In the first quarter under review, we continued to focus on
hybrid marketing activities that fuse the in-person sales approach with e-commerce, as we did in theprevious fiscal year, and as a result, the increased sales of e-commerce contributed to the growth of
consolidated net sales, leading to securing profits. In the main B2B site “MARKLESS STYLE,” salesof “MARKLESS Connect” continued to grow significantly. In the main D2C site “HANSOKUSTYLE,” the number of members increased and the repeat rate improved through measures such as
expanding the number of registered finished goods and improving the usability of the site. In addition,measures are gradually bearing fruit in “Original Goods Press” for product sales and OEM, and“Original.com,” which produces original corporate goods for sale and commemorative gifts. In termsof original brand sites, the “Calulu ONLINE STORE,” which handles pet wear and related finished-2-goods, and the “gowell” site, which handles travel-related finished goods, made effective use of social
media to assist the approach to customer segments that had not been fully catered to in the past.
As a result, e-commerce sales increased 423 million yen, or 41.0% year on year, and the sales
composition ratio expanded 4.7 percentage points year on year to 22.0%.
*

An abbreviation for “Direct to Consumer,” a business model in which a manufacturer plans andmanufactures its own commodities and sells them directly to end customers without intermediaries
such as wholesalers and stores.

Eco-products
The eco-products include reusable products made from organic cotton, recycled materials, biomass
plastics, and natural materials, as well as upcycled finished goods that have been transformed into morevaluable goods, by adding value such as ideas and design to wasted resources. These products
contribute to the reduction and control of CO2 emissions by focusing on materials, and have beenhighly evaluated and supported by client entities that are aware of their efforts to achieve the SDGs.
In Eco-products, under the key strategy of “finished goods demand arising from the promotion ofSDGs,” we strived to expand the product category of environmentally-friendly products. In the firstquarter under review, eco bags, tumblers, thermos bottles and other mainstay products put in a strong
performance. As these products are “plain products” that combine high versatility and excellent design,
they are used as novelties for sales promotions and as items for product sales at events. In addition tosales to end users and distributors, etc., sales of “MARKLESS STYLE” and “HANSOKU-STYLE” inthese products also increased due to the enhancement of e-commerce. In the “Original Goods Press” forproduct sales and OEM, the use of the eco-products as original store goods increased. In addition, theGroup’s efforts to promote fair trade in its eco-products were highly evaluated, and the Group received
the “Excellence in the Social Movement Category” for Fairtrade Japan Award 2023. The“MOTTERU,” which is being developed for the retail market, received the Good Design Award for the
fourth time in 2023, and it was selected for the third consecutive year as an endorsed product of the“Let’s choose! 3R Campaign 2023” sponsored by the Ministry of the Environment.
As a result, sales of Eco-products increased by 190 million yen, or 6.8% year on year.
Lifestyle products
In Lifestyle products, under the key strategies of “finished goods demand arising from reopening” and“tangible goods consumption derived from intangible goods consumption,” the Group expanded its
product and service menu for industries performing well and industries where demand for sales
promotions is expected to grow, and conducted efficient and effective marketing activities that fuse thein-person sales approach with e-commerce. In the first quarter under review, sales to the game andanimation industry, which is driving sales expansion of Lifestyle products, and peripheral industries
such as VTuber grew. In addition, demand for items in product sales increased, due to sales through ecommerce and at event venues of in-person events in the 2.5D and sporting events industries. Since
these items are diversified and require high quality, we responded to our client entities’ needs byintroducing new product categories and providing products with vivid full-color printing by introducing
new equipment at our factories in Japan. In addition, to raise awareness of new category products, we
exhibited quite a number of picture-style towels and acrylic products, which were well received by end
users, distributors, and other client entities. In sales promotions, we worked to expand sales bystrengthening planning proposals utilizing IP in response to the recovery in campaign demand. In pet
wear and related finished goods, we worked to expand sales channels and develop new products thatcan be sold year-round. In travel-related finished goods, we renewed products made in collaboration
with popular characters to meet inbound demand and focused on acquiring sales space at major
specialty stores and home centers in addition to expanding sales channels for future overseas travel
demand.
As a result, sales of Lifestyle products increased by 474 million yen, or 17.2% year on year.

-3-

Wellness products
There was a certain level of demand for sanitary products such as masks and disinfectant sprays. Sales
decreased by 5 million yen, or 1.7% year on year.
On the production side, the Company worked to secure multiple production bases, flexibly switch
between production sites in response to exchange rate fluctuations and surging raw material prices, andoptimize distribution channels in order to achieve a stable and continuous supply and strengthen pricecompetitiveness. We also increased the frequency of visits to overseas suppliers’ factories to improve
product quality and reduce product loss. In addition, we strived to maintain and improve profit margins
by developing new overseas and domestic suppliers to further strengthen our price competitiveness. At
our factories in Japan, the introduction of new equipment and the increase in the number of personnel
to handle production led to an increase in the in-house production ratio, resulting in higher productivity.
As a result, in the three months ended November 30, 2023, net sales increased to 6,624 million yen (upby 655 million yen, or 11.0% year on year), and operating profit increased to 1,487 million yen (up by
225 million yen, or 17.9% year on year) owing to securing gross profit by increase in net sales, andwell-planned expenditure of selling, general and administrative expenses. Ordinary profit increased to1,518 million yen (up by 262 million yen, or 20.9% year on year). Profit attributable to owners ofparent also increased to 1,002 million yen (up by 184 million yen, or 22.5% year on year).
Actual sales by sales channel and product classification for the three months ended November 30, 2023
were as follows.
<Actual sales by sales channel>(Millions of yen)
Net sales
Sales channel

ChangeThree months ended Three months ended
November 30, 2022 November 30, 2023

Change(Amount)

Change(%)

Targeting end-user companies

2,959

3,129

169

5.7

Targeting wholesalers

1,977

2,039

61

3.1

E-commerce

1,032

1,456

423

41.0

5,969

6,624

655

11.0

Total

<Actual sales by product classification>(Millions of yen)
Net sales
Product classification

ChangeThree months ended Three months ended
November 30, 2022 November 30, 2023

Change(Amount)

Change(%)

Eco-products

2,801

2,991

190

6.8

Lifestyle products

2,759

3,234

474

17.2

Wellness products

329

323

(5)

(1.7)

Design and other

79

75

(4)

(5.3)

5,969

6,624

655

11.0

Total
Note:

Design and other refers to those not falling under miscellaneous goods, including commissioned graphic,
products and WEB design operations, as well as printing operations.

-4-(2) Explanation of financial position
Status of assets, liabilities, and net assets
Current assets
Current assets at the end of the first quarter under review amounted to 13,775 million yen, a decrease of
1,414 million yen compared to the end of the previous fiscal year. This was due mainly to a decrease in
cash and deposits by 2,215 million yen, a decrease in finished goods by 14 million yen, and an increasein notes and accounts receivable - trade, and contract assets by 922 million yen.
Non-current assets
Non-current assets at the end of the first quarter under review amounted to 5,895 million yen, an
increase of 486 million yen compared to the end of the previous fiscal year. This was due mainly to anincrease in investments and other assets by 325 million yen, an increase in property, plant andequipment by 149 million yen, and an increase in intangible assets by 11 million yen.
Current liabilities
Current liabilities at the end of the first quarter under review amounted to 2,639 million yen, a decreaseof 786 million yen compared to the end of the previous fiscal year. This was due mainly to a decrease
in income taxes payable by 727 million yen.
Non-current liabilities
Non-current liabilities at the end of the first quarter under review amounted to 881 million yen, adecrease of 55 million yen compared to the end of the previous fiscal year. This was due mainly to adecrease in long-term borrowings by 49 million yen.
Net assets
Net assets at the end of the first quarter under review amounted to 16,150 million yen, a decrease of 86
million yen compared to the end of the previous fiscal year. This was due mainly to a decrease indeferred gains or losses on hedges by 38 million yen and a decrease in valuation difference on
available-for-sale securities by 37 million yen.
(3) Explanation of consolidated earnings forecasts and other forward-looking statements
The consolidated earnings forecasts for the six months ending February 29, 2024 and the fiscal year
ending August 31, 2024 are unchanged from the forecasts announced on October 12, 2023.
The earnings forecasts are based on information available as of the date of disclosure of this report.
Going forward, actual performance may vary from forecast figures depending on various factors.

-5-

2. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly Consolidated Balance Sheet(Thousands of yen)
As of August 31, 2023
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade, and contract
assetsSecurities
Finished goods
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets-6-

As of November 30, 2023

6,006,583

3,791,542

2,734,278

3,656,853

859,361
4,746,607
851,116(7,562)
15,190,385

855,704
4,732,435
746,500(7,561)
13,775,473

1,114,551

1,263,744

165,194
165,194

177,102
177,1022,880,031
1,249,530(380)
4,129,182
5,408,927
20,599,312

3,280,255
1,174,688–
4,454,943
5,895,791
19,671,264

(Thousands of yen)
As of August 31, 2023
Liabilities
Current liabilities
Accounts payable - trade
Current portion of long-term borrowings
Income taxes payable
Provision for bonuses
Provision for shareholder benefit program
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Retirement benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets-7-

As of November 30, 2023

959,141
332,513
1,087,987
223,496
7,337
815,340
3,425,816

1,199,128
303,330
360,188
122,008–
654,796
2,639,452

431,138
314,745
37,221
153,735
936,840
4,362,657

381,205
320,149
37,223
142,779
881,357
3,520,809

93,2223,305,428
12,144,917(203,471)
15,340,096

93,2223,305,428
12,128,270(203,471)
15,323,449

540,891
127,851
189,773
38,041
896,558
16,236,655
20,599,312

503,336
89,222
198,862
35,584
827,006
16,150,455
19,671,264

(2) Quarterly Consolidated Statement of Income and Consolidated Statement of Comprehensive
IncomeQuarterly Consolidated Statement of Income (Cumulative)(Thousands of yen)Three months ended
November 30, 2022
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Salaries and allowances
Provision for bonuses
Retirement benefit expenses
Provision of allowance for doubtful accounts
Other
Total selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Interest on securities
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to owners of parent-8-

Three months ended
November 30, 2023

5,969,644
3,640,956
2,328,688

6,624,888
4,022,344
2,602,543

325,339
91,4197,484
295
642,136
1,066,675
1,262,012

341,688
83,245
6,996(57)
682,734
1,114,607
1,487,935

87
10,452
1,249
11,78898
35,434140
35,673462
17,65421
18,1371,255,663

763
4,463
51
5,278
1,518,330

–

–

0
0
1,255,663
373,623
63,625437,249
818,413
818,413001,518,330
396,482
118,996
515,479
1,002,851
1,002,851

Quarterly Consolidated Statement of Comprehensive Income (Cumulative)(Thousands of yen)Three months ended
November 30, 2022
ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests-9-

Three months ended
November 30, 2023

818,413

1,002,851(21,886)(71,036)(3,765)(2,111)(98,799)
719,614(37,555)(38,629)
9,088(2,456)(69,552)
933,298

719,614933,298––

(3) Notes to Quarterly Consolidated Financial Statements
Notes regarding assumption of a going concern
None.
Notes on significant changes in the amount of shareholders’ equity
None.
Subsequent events
None.

- 10 -