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.

July 30, 2021

Consolidated Financial Results
for the First Three Months of Fiscal Year Ending March 31, 2022
(Under IFRS)
Company name: Members Co., Ltd.
Listing:
Tokyo Stock Exchange
Securities code:
2130
URL:
https://www.members.co.jp/
Representative:
Tadashi Kenmochi, Representative Director and President
Inquiries:
Akihiko Takano, Director and Senior Managing Executive Officer
Telephone:+81-3-5144-0660
Scheduled date to file quarterly securities report:
August 4, 2021
Scheduled date to commence dividend payments:―
Preparation of supplementary material on quarterly financial results: Yes
Holding of quarterly financial results briefing:
None(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated financial results for the first three months of fiscal year ending March 31, 2022 (from April
1, 2021 to June 30, 2021)(1) Consolidated operating results (cumulative)
RevenueThree months ended(Percentages indicate year-on-year changes.)

Operating profit

Profit before tax

Millions of yen%

Millions of yen

June 30, 2021

3,108

24.9

9

―

7

―

17

―

June 30, 2020

2,489

13.2

(58)

―

(59)

―

(11)

―

Profit attributable toowners of parent
Three months ended

Millions of yen%

ProfitTotal comprehensive
income%Millions of yen

Millions of yen%

Basic earnings
per share%

Millions of yen%

Diluted earnings
per share
Yen

Yen

June 30, 2021

17

17

1.38

1.34

June 30, 2020

(11)

(11)

(0.90)(0.90)(2) Consolidated financial position
Total assets
As ofEquity attributable toowners of parent

Total equity

Ratio of equity
attributable to owners ofparent to total assets

Millions of yen

Millions of yen

Millions of yen

June 30, 2021

7,692

4,449

4,449

57.9

%

June 30, 2020

8,648

4,614

4,614

53.4

2. Cash dividends
Annual dividends per shareFirst quarter-end
Fiscal year ended
March 31, 2021
Fiscal year ending
March 31, 2022

Second quarter-end

Third quarter-end

Yen

Yen

Yen

―

0.00

0.00

Fiscal year-end

Total

Yen

Yen

―

17.50

17.50

―

23.50

23.50

―

Fiscal year ending
March 31, 2022
(Forecast)

Note: Revisions to the forecast of cash dividends most recently announced: None

3. Consolidated earnings forecast for the fiscal year ending March 31, 2022 (from April 1, 2021 to March
31, 2022)(Percentages indicate year-on-year changes.)
Revenue

Operating profit

Profit before tax

ProfitMillions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

First half(cumulative)

7,000

29.4

504

242.9

490

244.9

328

174.3

Full year

15,200

25.8

1,800

42.6

1,790

43.4

1,199

33.8

Profit attributable toowners of parent
First half(cumulative)
Full year

Basic earnings
per share

Millions of yen

%

328

174.3

25.50

Yen

1,199

33.8

93.22

(Note) Changes from the latest financial forecast: None
1. The above consolidated earnings forecast is based on IFRS.
2. “Basic earnings per share” was calculated based on the average number of shares in FY 3/2021 (12,861,722).

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change
in scope of consolidation): None
Newly included: ―Excluded:―(2) Changes in accounting policies and changes in accounting estimates(i) Changes in accounting policies required by IFRS: None(ii) Changes in accounting policies due to other reasons: None(iii) Changes in accounting estimates: None
(3) Number of issued shares (ordinary shares)(i)

Total number of issued shares at the end of the period (including treasury shares)
As of June 30, 2021

13,129,300 shares

As of March 31, 2021

12,980,300 shares(ii) Number of treasury shares at the end of the period
As of June 30, 2021

90,093 shares

As of March 31, 2021

90,046 shares(iii) Average number of shares outstanding during the period (cumulative from the beginning of the fiscal
year)
Three months ended June 30, 2021

12,983,331 shares

Three months ended June 30, 2020

12,848,699 shares* Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants oran audit corporation.
* Proper use of earnings forecasts, and other special matters(Notes regarding the description, etc. related to the future)
The descriptions about the future, such as the business forecast, in this document are based on the information the company has obtainedso far and certain assumptions that are considered reasonable, and our company does not guarantee that the results will be as forecasted.
There is a possibility that actual business performance, etc. will be considerably different from the forecast due to various factors. For
the assumptions for the earnings forecast, notes for the use of the forecast, etc., please refer to “1, Qualitative Information Regarding the
Financial Results for the Current Quarter, (3) Explanation Regarding the Future Forecast Information such as Consolidated Earnings
Forecast” on page 4 of the Appendix.
(How to obtain the material for supplementary explanations on financial results and the contents of the session for briefing financial
results)
The material for supplementary explanations on financial results will be uploaded to the website of our company on Friday, July 30,
2021.

○Table of contents of the appendix
1. Qualitative Information Regarding the Financial Results for the Current Quarter…………………………………………..

2(1) Explanation Regarding Business Results…………………………………………………………………………………

2(2) Explanation Regarding the Financial Standing……………………………………………………………………………

3(3) Explanation Regarding the Future Forecast Information such as Consolidated Earnings Forecast………………………

4

2. Summary of Consolidated Financial Statements and Major Notes………………………………………………………….

5(1) Summary of Quarterly Consolidated Balance Sheets…………………………………………………………………….

5(2) Summary of Quarterly Consolidated Statements of Income………………………………………………………………

7(3) Summary of Quarterly Consolidated Statements of Comprehensive Income……………………………………………

8(4) Summary of Quarterly Consolidated Statements of Changes in Equity…………………………………………………

9(5) Summary of Quarterly Consolidated Statements of Cash Flows…………………………………………………………

10(6) Notes to Summary of Consolidated Financial Statements………………………………………………………………

11(Notes on Going Concern Assumption) ……………………………………………………………………………………

11(Significant Subsequent Events) …...………………………………………………………………………………………

11

1

1. Qualitative Information Regarding the Financial Results for the Current Quarter(1) Explanation Regarding Business Results・Management’s Explanation and Analysis of Business Results
Due to the climate change caused by global warming, severe natural disasters have been occurring frequently all over theworld. In Japan, the Carbon-Neutral policy to virtually eliminate the emission of greenhouse gases such as carbon dioxide,
which are a major cause of global warming, by 2050 was announced, and as the debate around deregulation to proactively
utilize this policy began, we are expecting businesses, including marketing activities, to transform into a model for
decarbonization or resolving societal issues. In addition, as the business environment changes drastically due to the global
spread of the novel coronavirus, there is an increasing need for companies to fundamentally rethink their business itself andfurther accelerate corporate transformation through Digital Shift or DX (Digital Transformation) for continuous value creation.
As the DX Market gradually becomes more active, each company is having difficulty to recruit and train creative personnel
who are versed in the Internet and digital technology on its own, and such personnel shortage is now a huge hurdle in DX. In
Japan, the jobs-to-applicants ratio for IT engineers in June 2021 was 7.84, showing a significantly high demand compared tothe overall average ratio of 1.86 (Persol Career Co., Ltd.: Jobs-to-Applicants Ratio Report, published on July 15, 2021), and ashortage of approximately 790,000 IT engineers is expected in 2030 (Ministry of Economy, Trade and Industry: Survey(Outline) Regarding the Supply and Demand of IT Personnel, published in April 2019).
Under such circumstances, we uphold to create a spiritually rich society through “MEMBERSHIP” as its mission, and aims
to convert our client companies’ management style, marketing activities, services, and products into “Sustainable Ones for the
Earth and Society.” During the 26th Regular General Meeting of Stockholders held in June 2021, we decided to specify“Initiatives Toward Societal Issues such as Climate Change and Depopulation” in the articles of incorporation, then announced
that we would become a leading force in the accelerating actualization of a sustainable society.
We are primarily developing two businesses centered around the DX domain.
<EMC Business Outline>
We have organized the Engagement Marketing Center (EMC), which consists of teams dedicated to continuously improvebusiness results and user engagement for the clients of large companies by using digital means. EMC Company is the center ofthis business and supporting the pursuit of DX for client companies. It offers a comprehensive support service from discovering
issues and requirement definition from the point of view of client companies, to the development and operation of digital
services and products.
As companies are accelerating digital shift, the EMC business has been increasing the sales especially from existing clientcompanies steadily. Although the number of clients companies implemented by the EMC model decreased to 44 (down 3 fromthe end of the previous term) since some projects were shifted to the PGT business, the utilization rate of existing employees,
excluding newly graduates who have just joined in April, 2021, improved significantly from the same quarter of the previous
year, and the revenue of this consolidated cumulative first quarter reached 2,129 million yen (IFRS *Reference Value: Up 15.1%
year on year), showing a favorable trend. Further, the number of digital creators belonging to the EMC business rose to 950 (up175 from the end of the previous term).
<PGT Business Outline>
In the PGT (Product Growth Team) business, we have shifted the focus of its services from the conventional business thatwas offering creators with specialized skills, to supporting client’s product growth in the field of new technology by autonomous
teams of digital creators, for Internet and start-up companies with high growth potential, which are also proactive in mainly
digital and IT technology investment. The PGT business creates occupations in the New Technology and New Growth Support
domains, centered around Members Career Company and Members Edge Company. We plan to start up in-house companies
proactively this term especially in the engineering domain, which has a high added value, and make efforts to enhance
profitability by achieving high average price and high performance. We have established the following in-house companies in
FY 3/2022.
-SaaS Plus Company (established in April 2021), which offers a SaaS-based growth team business-DevOps Lead Company (established in July 2021), which supports the promotion of DevOps by offering a team of professional
personnel
With the prosperity of the DX market, the PGT business has continued to grow steadily through support services in2

specialized domains such as data and UX (*1) domains, as well as through the rapid growth of the engineering domain, driving
the growth of our corporate group. Due to an increase in profitability owing to the steady growth of the specialized domain
support services with high added value along with an improvement in the utilization rate during the first quarter of the current
term, the overall revenue of the PGT business reached 1,132 million yen (IFRS *Reference Value: Up 42.4% from the samequarter of the previous year), the number of client companies reached 138 (up 31 from the end of the same quarter of theprevious year), and the number of digital creators belonging to the PGT business reached 697 (up 168 from the end of theprevious term).
<Our Corporate Group’s Policies and Initiatives>
Our corporate group engages in continuous recruitment as upfront investment, predicting a significant shortage of creators
who are versed in digital technology and the Internet. We have been extensively recruiting graduates of art universities, technicalcolleges, technical schools on Web-related creation, four-year universities, and graduate schools. A total of 364 newly graduates
joined us in April 2021 (including local bases), up 128 from the previous year. We assigned new employees’ tasks earlier thanusual in the current consolidated fiscal year and started business operations with them in June.
Through the continuous expansion in the service domain of both EMC and PGT businesses, along with the early training andearly operation for new employees, we will increase profitability and strengthen our investments in recruitment and training.
Further, our corporate group has been promoting a company-wide work-from-home workstyle and the utilization of remoteenvironments. We will continue capital investment for the reduction of office space and the implementation of a smooth remote
work, to establish a work system that will produce even better results.
<Overview of Consolidated Financial Statements>
For the first quarter of the current consolidated term, revenue was 3,108 million yen (up 24.9% in the same quarter of theprevious year), operating profit was 9 million yen (a loss of 58 million yen in the same quarter of the previous year), quarterly
profit before income taxes was 7 million yen (a loss of 59 million yen in the same quarter of the previous year), and profit
attributable to the owners of the parent was 17 million yen (a loss of 11 million yen in the same quarter of the previous year).
Revenue has been steadily growing, increasing 24.9% in the same quarter of the previous year mainly due to the favorable
trend in the high added value domain of the PGT Business, and reached a new record for the first quarter. Operating profit
increased 67 million yen from the same quarter of the previous year and marked a surplus in the first quarter for the first timein six years. The main factors behind this were an increase in the added-value sales per person and an improvement of theutilization rate, along with a reduction in fixed costs due to remote working.
As

wecontinue

to

work

on

fulfillingourlong-term

vision,VISION2030(https://www.members.co.jp/ir/pdf/20200508_04.pdf), we will take initiatives with the aim of achieving the important KPIs of
100,000 social creators (*2), the total amount of social engagement (*3) of 10 billion, 10,000 employees, and an operating
profit of 10 billion yen in 2030.
(*1) UX (User Experience): The experience one gains by using a product or service.
(*2) Social Creator: A motivated creator (artisan) with design thinking, who tries to resolve societal issues through the promotion of business, systemic design,and output.
(*3) Social Engagement: The number of contacts with the contents, products, and services worked on by Members Group as its policy to resolve societal
issues.

(2) Explanation Regarding the Financial Standingi)Status of Assets, Liabilities, and Shareholders’ Equity
The total assets at the first quarter of the current consolidated term were 7,692 million yen (down 956 million yen from theend of the previous consolidated fiscal year). This is primarily due to an increase of 162 million yen in other current assets andan increase of 55 million yen in inventories, along with a decrease of 754 million yen in trade and other receivables, a decreaseof 330 million yen in cash and cash equivalents, and a decrease of 80 million yen in right-to-use assets.
Total liabilities stood at 3,242 million yen (down 792 million yen from the end of the previous consolidated fiscal year). Thiswas primarily due to a decrease of 335 million yen in income taxes payable, a decrease of 168 million yen in trade and otherpayables, a decrease of 117 million yen in other current liabilities, and a decrease of 88 million yen in contract liabilities.
3

Total equity was 4,449 million yen (down 164 million yen from the end of the previous consolidated fiscal year). This wasprimarily due to an increase of 25 million yen in capital stock, an increase of 25 million yen in capital surplus, and a decreaseof 207 million yen in retained earnings.
ii)Status of Cash FlowsThe cash and cash equivalent (hereinafter referred to as “funds”) at the end of the first quarter of the current consolidated term
was 3,810 million yen, down 330 million yen from the end of the previous consolidated fiscal year. The status of each cash flow
for the first quarter and the factors behind them are as follows.
(Cash Flows from Operating Activities)
The funds used during the first quarter as a result of operating activities amounted to 74 million yen (173 million yen acquired
during the same quarter of the previous year). The income was mainly from a decrease of 665 million yen in trade and otherreceivables, the expenditure was mainly from 348 million yen paid as income taxes paid, 259 million yen paid in others, and adecrease in trade and other payables of 173 million yen.
(Cash Flows from Investing Activities)
The funds acquired during the first quarter as a result of investing activities amounted to 2 million yen (1 million yen used in
the same quarter of the previous year). The income was mainly from 2 million yen in other income.
(Cash Flows from Financing Activities)
The funds used during the first quarter as a result of financing activities amounted to 258 million yen (down 309 million yen
from the same quarter of the previous year). The expenditure was mainly from 220 million yen as dividends paid and 81 million
yen in expenditure for the repayment of lease liabilities.
(3) Explanation Regarding the Future Forecast Information such as Consolidated Earnings Forecast
There are no changes in the consolidated earnings forecast for the cumulative second quarter of FY 3/2022 as well as the entire
fiscal year, announced on May 7, 2021.
(Regarding the Dividend Forecast)
From the point of enhancing the return of profits to all of our shareholders and further increasing enterprise value, we willretain earnings in preparation for new business investment for long-term profit growth and the expansion in business activities,
as well as set a fundamental policy of the distribution of profits according to the improvement of business results and a continuous
increase in the dividend amount. Our medium-term target of an equity dividend ratio attributable to owners of the consolidated
parent company is about 5%.
After comprehensively taking into account of the DOE and dividend payout ratio, the term-end dividend for FY 3/2022 isplanned to be 23.50 yen.

4

2. Summary of Consolidated Financial Statements and Major Notes(1) Summary of Quarterly Consolidated Balance Sheets[unit: thousand yen]Previous consolidated
accounting year
(Mar. 31, 2021)

1st quarter of the current
consolidated accounting year
(Jun. 30, 2021)

AssetsCurrent assets
Cash and cash equivalents

4,140,847

3,810,108

2,842,456
31,803

2,088,082
87,540

Other current assets

173,103335,759

Total current assets

7,188,210

6,321,491

Non-current assets
Tangible fixed assets

252,811248,648

Rights to use as assets
Goodwill

491,002
116,115

410,963
116,115

Intangible assets
Other financial assets

8,436
266,909

6,926
264,627

Deferred tax assets
Other non-current assets

323,8021,309

322,350916

Total non-current assets

1,460,387

1,370,548

8,648,597

7,692,039

Trade receivables and other receivables
Inventory assets

Total assets

5[unit: thousand yen]Previous consolidated
accounting year
(Mar. 31, 2021)

1st quarter of the current
consolidated accounting year
(Jun. 30, 2021)

Liabilities and shareholders’ equity
Liabilities
Current liabilities
Lease liabilities
Trade payables and other payables

234,773
974,844

194,119806,051

Income taxes payable
Contract liabilities

356,050
234,351

20,885
145,765

Other current liabilities

1,970,892

1,853,487

Total current liabilities

3,770,912

3,020,310

Non-current liabilities
Lease liabilities
Allowance
Total non-current liabilities

157,327

115,300

106,181

106,448

263,509

221,748

4,034,422

3,242,059

Capital stock
Capital surplus

910,405
228,752

935,493
253,839

Treasury shares
Other components of equity(8,240)55,622(8,370)49,021Retained earnings

3,427,635

3,219,996

Total equity attributable to owners of the parent

4,614,175

4,449,980

Total shareholders’ equity

4,614,175

4,449,980

8,648,597

7,692,039

Total liabilities
Shareholders’ equity

Total liabilities and equity6(2) Summary of Quarterly Consolidated Statements of Income[unit: thousand yen]
1Q FY2021(Apr. 1, 2020 to Jun. 30, 2020)

1Q FY2022(Apr. 1, 2021 to Jun. 30, 2021)

Revenue

2,489,503

3,108,629

Cost of sales

1,768,295

2,216,001

Gross profit

721,207892,628

Selling, general and administrative expenses
Other income

801,130
23,041

890,483
8,261

1,162

1,349

(58,043)
8

9,056
0

Other expenses
Operating profit (loss)
Finance income
Finance costs

1,954

1,544

Profit (loss) before income taxes(59,989)

7,512

Income taxes(48,422)(10,429)

Profit (loss) for the period(11,566)

17,941

Profit (loss) attributable to
Owners of parent(11,566)

17,941(11,566)

17,941(0.90)(0.90)

1.38
1.34

Net profit (loss)
Earnings per share
Basic earnings (loss) per share (yen)Diluted earnings (loss) per share (yen)7(3) Summary of Quarterly Consolidated Statements of Comprehensive Income[unit: thousand yen]
1Q FY2021(Apr. 1, 2020 to Jun. 30, 2020)

1Q FY2022(Apr. 1, 2021 to Jun. 30, 2021)(11,566)

17,941

Financial assets measured at fair value through othercomprehensive income

346-

Total of items that will not be reclassified to profit or loss

346

-

346

-

Comprehensive income(11,220)

17,941

Comprehensive income attributable to
Owners of parent(11,220)

17,941(11,220)

17,941

Profit (loss) for the period
Other comprehensive income
Items that will not be reclassified to profit or loss

Total comprehensive income

Comprehensive income8(4) Summary of Quarterly Consolidated Statements of Changes in Equity
Consolidated first quarter of the prior fiscal year ended March 2021 (Apr. 1, 2020 to Jun. 30, 2020)[unit: thousand yen]
Equity attributable to owners of parent
Noncontrollinginterests

Total
equityOther
componentsof equity

Retainedearnings

Total(7,922)

44,6272,709,135

4,121,578

67,513

4,189,092---(11,566)(11,566)-(11,566)

-

-

-

346

-

346

-

346

-

-

-

346

(11,566)(11,220)-(11,220)

329

329

-

(79)

-

579

-

579

Dividends

-

-

-

-

(179,874)(179,874)-(179,874)

Transfer to retained earnings

-

-

-

(346)

346

-

-

-

Purchase of non-controllinginterests-(255,104)---(255,104)(67,513)(322,618)

Total transactions with owners

329(254,775)

-

(425)

(179,528)(434,400)(67,513)(501,914)

901,472

219,819(7,922)44,5482,518,040

3,675,958-

3,675,958

Capitalstock

Capitalsurplus901,143474,594

Profit for the period-

Other comprehensive income

Balance on April 1, 2020

Total comprehensive income
Execution of employee stock
options

Balance on June 30, 2020

TreasurysharesConsolidated first quarter of the current fiscal year ending March 2022 (Apr. 1, 2021 to Jun. 30, 2021)[unit: thousand yen]
Equity attributable to owners of parent
Capitalstock
Balance on April 1, 2021

Capitalsurplus

Other
components ofequityTreasurysharesRetainedearnings

Total

Total
equity910,405

228,752(8,240)55,622

3,427,635

4,614,175

4,614,175

-

-

-

-

17,941

17,941

17,941----

17,941

17,941

17,941

25,08725,087-(6,601)-

43,573

43,573Purchase of treasury shares

-

-

(129)

-

-

(129)

(129)

Dividends

-

-

-

-

(225,579)(225,579)(225,579)

Total transactions with owners

25,08725,087(129)(6,601)(225,579)(182,135)(182,135)

Balance on June 30, 2021

935,493

253,839(8,370)49,021

3,219,996

4,449,980

4,449,980

Profit for the period
Total comprehensive income
Execution of employee stock
options9

(5) Summary of Quarterly Consolidated Statements of Cash Flows[unit: thousand yen]
1Q FY2021(Apr. 1, 2020 to Jun. 30, 2020)

1Q FY2022(Apr. 1, 2021 to Jun. 30, 2021)(59,989)
79,576

7,512
87,316

1,863

(0)
1,384

(Increase) decrease in inventories(Increase) decrease in trade and other receivables(47,879)
812,460(55,736)
665,931

Increase (decrease) in trade and other payables
Other(376,624)(57,543)(173,233)(259,709)

351,864

273,464

6,008

0
1,508

Interest paid
Income taxes paid

(1,218)(183,495)(1,071)(348,187)

Cash flows from operating activities

173,158(74,284)(6,766)
5,346

-

-

2,236

(1,420)2,236(70,681)(81,257)

579-

43,573(129)

Dividends paid
Purchase of non-controlling interests(175,440)(322,618)(220,876)-

Cash flows from financing activities(568,160)(258,690)

Cash flows from operating activities
Profit (loss) before income taxes
Depreciation and amortization
Finance income
Finance costs

SubtotalInterest and dividends received
Proceeds from subsidy income

Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of investments
Other
Cash flows from investing activities
Cash flows from financing activities
Repayments of lease liabilities
Proceeds from exercise of employee stock options
Payments for purchase of treasury shares

Net increase (decrease) in cash and cash equivalents(396,422)(330,739)

Cash and cash equivalents at beginning of period

3,115,696

4,140,847

Cash and cash equivalents at end of period

2,719,273

3,810,10810

(6) Notes to Summary of Consolidated Financial Statements(Notes on Going Concern Assumption)
There is no related information.
(Significant Subsequent Events)
There is no related information.

11