Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023
(Three Months Ended June 30, 2022) (Based on J-GAAP)

July 29, 2022
Company name: Marvelous Inc.
Listing: Tokyo Stock Exchange
Stock Code:7844
URL https://corp.marv.jp/english/index.html
Representative:
Suminobu Sato, President
Contact:
Seiichiro Kato, Director, Head of Administration Unit
Tel: +81-3-5769-7447
Scheduled date of filing Quarterly Securities Report: August 2, 2022
Scheduled commencement date of dividend payout: ‒Explanatory documents supplemental to the abridged Quarterly Financial Statements: Yes
Quarterly Result briefing: None
(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023 (April 1,2022 - June 30, 2022)(Percentages represent year-over-year changes)(1) Consolidated Results of Operations (three months)
Net sales
Million yen
1Q FY2023
5,319
1Q FY2022
6,473
Note: Comprehensive income (million yen):

1Q FY2023
1Q FY2022

Operating profit

Ordinary profit%
Million yen%
Million yen%
(17.8)
780(46.7)
1,132(23.2)
38.6
1,464
64.6
1,474
65.5
1Q FY2023: 1,189 (6.9%)
1Q FY2022: 1,112 (93.0%)

Net income per share Diluted net income per share
Yen
Yen
12.45
–
17.80
–

(2) Consolidated Financial Position
Total assets

Net assets

Equity ratio

Million yen
Million yen
1Q FY2023
35,21628,155
FY202236,531
28,973
Reference: Shareholders’ equity: (million yen) 1Q FY2023: 28,124
FY2022: 28,939

2.

Net assets per share%
79.9
79.2

Yen
465.73479.23

Dividends
1Q-endYen––InterimDividends per share
3Q-end
Yen
Yen
0.00
–

FY2022
FY2023–FY2023 (forecasts)
Note: Revisions to the most recently announced dividend forecast: None
The dividend forecasts for FY2023 are not decided at this point in time.

3.

Profit attributable toowners of parent
Million yen%752(30.0)
1,074
81.1

–Year-end

Yen
33.00

Annual

Yen
33.00

–

Consolidated Forecasts for the Fiscal Year Ending March 31, 2023 (April 1, 2022 – March 31, 2023)–(Percentages represent year-over-year changes)
Profit attributable toNet income perNet sales
Operating profit
Ordinary profit
owners of parent
shareMillion yen%
Million yen% Million yen% Million yen%
Yen
25,000 - (2.8) 4,000 - (13.1) 4,200 (16.9) 2,940 (23.0) 48.68 Full year
28,800
11.9
4,600
0.0
4,800(5.0)
3,360(12.0)
55.64
Note: Revisions to the most recently announced earnings forecast: Yes
The full-year financial forecast for the fiscal year ending March 2023 has been disclosed in a range format because it is difficult toforecast the financial results at a specific value due to a large number of new original titles for consumer and online games
scheduled to be released this fiscal year, a large fluctuation in the financial results depending on the degree of their hits, andconcerns over the impact of the COVID-19 pandemic in stage performances. For details, please refer to P.4 “1. Qualitative
Information Concerning Quarterly Results (3) Explanation of Business Outlook Including Consolidated Business Forecast.”-1-*Notes(1) Changes in significant subsidiaries during the consolidated period (three months) under review (changes insubsidiaries accompanying change in the scope of consolidation): None
New:None (Company name:)
Excluded: None (Company name:)(2) Application of accounting procedures specific to the preparation of quarterly consolidated financialstatements: Yes(3) Changes in accounting principles, estimates, and restatement
1) Changes in accounting principles caused by revision of accounting standards: None
2) Changes in accounting principles other than those mentioned above: None
3) Changes in accounting estimates: None
4) Restatement: None
(4) Number of shares issued and outstanding (shares of common stock)1) Number of shares outstanding(including treasury shares) at end
1Q FY2023 62,216,400 sharesof period2) Number of treasury shares at end
1Q FY2023 1,828,646 sharesof period3) Average number of shares
1Q FY2023 60,387,754 shares
outstanding during the period

FY202262,216,400 shares

FY2022

1,828,646 shares

1Q FY2022 60,359,954 shares

Note: The number of treasury shares at end of the period is stated, including 456,100 shares held by Custody Bank of Japan,
Ltd. (Trust E Units) as trust assets of the Board Benefit Trust (BBT).

* The summary of quarterly financial statements is not subject to quarterly review by a certified public accountant (CPA) or an audit
firm.
* Cautionary statement with respect to forward-looking statements and other special items
The forecasts and other forward-looking statements contained in this document are based on information currently available to theCompany and certain assumptions deemed to be reasonable. Actual results may differ materially from these forecasts due to avariety of factors.
For details, please refer to P.4 “1. Qualitative Information Concerning Quarterly Results (3) Explanation of Business Outlook
Including Consolidated Business Forecast.”-2-Marvelous Inc. (7844) / Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023
(Based on J-GAAP)

1.

Qualitative Information Concerning Quarterly Results(1) Explanation of Consolidated Business Results
The entertainment industry in the period under review saw the domestic home video game market continue toexperience a shortage of game consoles due to a prolonged shortage of semiconductors, which resulted in adecline in the market size compared to the previous year. In the mobile game market, the environment
surrounding new entry titles remains severe, the competitive environment is becoming more severe, and thetendency in the struggle for existence has been strengthened. In the amusement market, the recovery trend iscontinuing and is approaching the level before COVID-19 pandemic, but there are concerns about the future
impact of the current resurgence of infections. In the audio and visual market, there is a growing sense ofstagnation due to the end of nesting demand even in the video distribution market, which has been doing well,such as drawing attention to the decline in the number of subscribers to major distribution services. In the live
entertainment market, although there were signs of recovery, the recovery of audience participation was slow,
there were frequent cancellations of performances due to infection of performers and staff, and the severemarket environment remained unchanged.
Under these circumstances, the Group has been operating as a comprehensive entertainment provider
deploying a multi-content, multi-use, and multi-device strategy to deliver entertainment content in all businesssegments and on a variety of devices. In order to establish robust IPs, the Group has been driving its strategy
in the three key areas of branding, alliances, and global business, and is working to offer content that generates
excitement among today’s users while endeavoring to enhance its services.
As a result, the Group’s consolidated operating results for the period under review (April 1, 2022 - June 30,2022) came to net sales of 5,319 million yen (down 17.8% compared with the same period of the previousyear), operating profit of 780 million yen (down 46.7% compared with the same period of the previous year),ordinary profit of 1,132 million yen (down 23.2% compared with the same period of the previous year), andprofit attributable to owners of parent of 752 million yen (down 30.0% compared with the same period of theprevious year).
Results by business segment are described below.
The reportable segments have been changed since the first quarter under review, and the comparison andanalysis for the first quarter under review are based on the changed categories.
(i) Digital Contents BusinessIn the consumer division of this business, a new multi-platform game “DEADCRAFT” was released
simultaneously worldwide on May 19, 2022 as a title exclusively for download. However, sales fell shortof the target. In addition, as a reactionary decline following the strong sales of “Rune Factory 5,” which
was launched in May of the previous fiscal year, sales and profit decreased from the same period of theprevious fiscal year.
In the online division, the collaboration measures of “Logres of Swords and Sorcery: Goddess of Ancient”
and the addition of new characters to commemorate the 4.5 year anniversary of “SHINOVI MASTER SENRAN KAGURA NEW LINK-” were well received. In addition, “The Thousand Musketeers:Rhodoknight,” which was released in November 2021, increased the number of users and sales at the halfanniversary event held in May 2022, but its contribution to earnings was limited.
As a result, segment net sales totaled 3,030 million yen (down 32.6% compared with the same period ofthe previous year), with segment profit of 252 million yen (down 82.5% compared with the same periodof the previous year).
(ii) Amusement BusinessIn this segment, sales of the new tag of “Pokémon MEZASTAR,” the key kids’ amusement machine, whichstarted operation on April 21, 2022, were extremely favorable, achieving record sales. On the other hand,“Pokémon Ga-Olé,” which is currently operating overseas, continued to be affected by the implementationof partial business restraint and business restrictions in areas where the COVID-19 outbreak has spread,
while other regions performed well.
As a result, segment net sales totaled 1,726 million yen (up 40.9% compared with the same period of theprevious year) with segment profit of 702 million yen (up 101.9% compared with the same period of theprevious year).
-3-Marvelous Inc. (7844) / Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023
(Based on J-GAAP)(iii) Audio and Visual BusinessIn the audio and visual production division, the latest animated TV program of Yu-Gi-Oh! series, “Yu-GiOh! GO RUSH!!,” and the TV animation “Aoashi” began broadcasting from April 2022. In addition, thefirst part of the new trilogy of the animation “TOUKEN RANBU HANAMARU Season 3,” “YUKI NO
MAKI” was released in theaters on May 20 of the same year.
In the stage production division, new plays of series such as “Musical HAKUOKI SHINKAI” and “Touken
Ranbu the Stage” were performed. Although sales decreased due to a decrease in the number ofperformance titles recorded in the first quarter under review, there was a significant increase in profit owing
to the recording of J-LODlive (Japan content LOcalization and Distribution live entertainment) Subsidy,etc.
As a result, segment net sales totaled 562 million yen (down 24.9% compared with the same period of theprevious year), with segment profit of 229 million yen (segment profit in the same period of the previous
fiscal year was 18 million yen).
(2) Explanation of Consolidated Financial Position
On the consolidated balance sheets at the end of the first quarter, the Group had total assets of 35,216 millionyen (down 1,315 million yen from the end of the previous fiscal year), total liabilities of 7,060 million yen(down 497 million yen from the end of the previous fiscal year), and net assets of 28,155 million yen (down817 million yen from the end of the previous fiscal year).
(Current assets)
Consolidated current assets at the end of the first quarter totaled 26,679 million yen, down 1,426 million yen
from the end of the previous fiscal year, mainly due to a decrease in cash and deposits.
(Non-current assets)
Consolidated non-current assets at the end of the first quarter totaled 8,536 million yen, up 111 million yen
from the end of the previous fiscal year, owing mainly to an increase in intangible assets.
(Current liabilities)
Consolidated current liabilities at the end of the first quarter totaled 6,645 million yen, a decrease of 497
million yen from the end of the previous fiscal year, owing mainly to decreases in accounts payable - tradeand in accounts payable - other.
(Non-current liabilities)
Consolidated non-current liabilities at the end of the first quarter totaled 414 million yen, showing no change
from the end of the previous fiscal year.
(Net assets)
Consolidated net assets at the end of the first quarter totaled 28,155 million yen, down 817 million yen fromthe end of the previous fiscal year, due to a decrease in retained earnings resulting from dividends for theprevious fiscal year, despite recording 752 million yen in profit attributable to owners of the parent.
(3) Explanation of Business Outlook Including Consolidated Business Forecast
With regard to consumer games, the Steam® version of “Rune Factory 5” and the PlayStation® 4 version of“BOKUJO MONOGATARI OLIVE TOWN TO KIBO NO DAICHI,” which had been also released for theNintendo SwitchTM in 2021, were released on July 14 and July 28, respectively. “No More Heroes 3,” also
released for the Nintendo SwitchTM in 2021, will be available for PlayStation® 4/PlayStation® 5, Xbox Series
X|S/Xbox One, and Steam® in October. In addition, another completely new juvenile RPG titled “LOOP8”
for Nintendo SwitchTM, PlayStation®4, and Xbox One will be released in 2022.
With regard to online games, “Dolphin Wave,” a new original IP game application for smartphones isscheduled to be distributed in FY2022 and its pre-registration is now available in the brand name of “HONEY
PARADE GAMES,” which has developed “SENRAN KAGURA” series and other titles.
In the amusement business, sales of its mainstay “Pokémon MEZASTAR” series continued to be strong, withthe new Tag starting operation on July 7. However, there are concerns that sales may be affected again
depending on the future COVID-19 situation. Although sales of overseas “Pokémon Ga-Olé” have been-4-Marvelous Inc. (7844) / Consolidated Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023
(Based on J-GAAP)

affected in some operating regions where the number of COVID-19 cases is increasing, it has been performing
well in other regions.
In the audio and visual production division, the second part of the new trilogy of the animation “TOUKENRANBU HANAMARU Season 3,” “TSUKI NO MAKI” was released in theaters on July 8. In addition, thelast part, “HANA NO MAKI” of “TOUKEN RANBU HANAMARU Season 3” will be released on September
1. The latest new movie in the Pretty Cure series, “Delicious Party Pretty Cure the Movie” will also be releasedin theaters on September 23. In addition, as a new project, we have decided to hold a fireworks event projectaiming for synergy with the audio and visual business. As the first project, we will host “ICHIKAMISATO
HANAMIRAI-FIREWORKS＊FUTURE-2022” to be held on October 2 in Ichikawa Misato-cho, Yamanashi.
In the stage production division, a new play of “Stage[Yowamushi Pedal]” was held from July 5 to 18. A newplay of “MUSICAL THE PRINCE OF TENNIS” is scheduled to run from July 5 to August 28, but someperformances have been canceled after a person concerned tested positive for COVID-19. In addition, newplays are scheduled for popular titles such as “World Trigger the Stage,” “MUSICAL AOHARU TETSUDO,”“MUSICAL『MORIARTY THE PATRIOT』,” “Touken Ranbu the Stage,” and Musical “Ouran High School
Host Club,” and live performances such as “MUSICAL THE PRINCE OF TENNIS II Revolution Live 2022”and “Musical HAKUOKI HAKU-MYU LIVE 3.” Further, we are preparing a large lineup of new productions
for this fiscal year, including “MUSICAL ACE OF DIAMOND,” “MAHOROBAKANATA,” “TOKYOCOLOR SONIC!! THE STAGE” and other planned new stage productions. However, the recovery ofcustomers in the live entertainment field is uncertain, it is expected that the market environment will remain
severe, and the achievement may be significantly affected by the possibility of cancellations due to infectionof related persons.
The full-year financial forecast for the fiscal year ending March 2023 had not been determined due to thedifficulty of making a reasonable calculation of the impact on the business amid uncertainty over the resolutionof COVID-19. However, the forecast has been calculated based on currently available information, including
the progress made in the first quarter and the impact on each business. However, due to the large number of
new original titles in consumer and online games scheduled to be released this fiscal year, the achievement
fluctuates greatly depending on the degree of their hits, and because there is considerable concern about theimpact of COVID-19 in stage performances, it is difficult to predict with specific figures, and therefore, thedisclosure is made in a range format. In the future, when it becomes possible to disclose the specified forecast
values, we will promptly disclose them.
The year-end dividend forecast for the fiscal year ending March 2023 will be disclosed when it becomes
possible to disclose specific figures in the earnings forecast.
Net sales
FY2023 (forecasts)*Reference
Results of the previous
fiscal year
(FY ended March 2022)

Operating profit

Million yen
25,000- 28,800

Million yen
4,000- 4,600

25,7284,600-5-Profit attributable toowners of parent
Million yen
Million yen
4,200
2,940
- 4,800- 3,360

Ordinary profit

5,054

3,817

Net income pershareYen
48.68- 55.64
63.23