Translation
Notice: This document has been translated from a part of the Japanese original for reference purposes only. In the event of any
discrepancy between this translated document and the Japanese original, the latter shall prevail.

Summary of Consolidated Financial Results
for the First Two Quarters of the Fiscal Year Ending March 2024
(Based on Japanese GAAP)
November 10, 2023
Company name: Interworks Confidence Inc.

Listing exchange: Tokyo Stock Exchange

Securities code: 7374

URL: https://ciw.jp/

Representative: Nobuyuki Takushi, President
Inquiries:

Koji Nagai, Director in charge of Administration Division

Scheduled date for filing quarterly securities report:

Phone: +81-3-5312-7700

November 10, 2023

Scheduled date for commencing dividend payments: December 5, 2023
Preparation of supplementary materials on quarterly financial results: Yes
Holding of quarterly financial results briefing session:

Yes(Amounts are rounded down to the nearest million yen, unless otherwise noted)
1. Consolidated Financial Results for the First Two Quarters (April 1, 2023 to September 30, 2023) of the Fiscal Year Ending March 31, 2024
(1) Consolidated Operating Results (Cumulative)(Percentage figures represent year-on-year changes)
Profit attributable to
Revenue
Operating profit
Ordinary profit
owners of parent
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
First two quarters ended September 30,
2023
First two quarters ended September 30,
2022

3,249

27.7

561

12.2

510

2.1

337

(0.5)

2,544

21.5

501

41.5

500

44.1

339

45.2

(Note) Comprehensive income
First two quarters ended September 30, 2023:
First two quarters ended September 30, 2022:

First two quarters ended
September 30, 2023
First two quarters ended
September 30, 2022

337 million yen [-0.5%]339 million yen [45.2%]

Basic earnings
per share
Yen

Diluted earnings
per share
Yen

63.86

62.63

74.04

71.76

(2) Consolidated Financial Position
Total assets
As of September 30, 2023
As of March 31, 2023
(end of previous fiscal year)(Reference) Total shareholders’ equity
As of September 30, 2023:
As of March 31, 2023:

Net assets

Equity ratio

Millions of yen
6,762

Millions of yen
5,712

%
84.2

2,892

2,023

69.6

5,696 million yen
2,012 million yen

2. Cash Dividends
Annual dividends per share
End of 1st quarter End of 2nd quarter End of 3rd quarter
Yen
Yen
Fiscal year ended March 2023–
20.00
Fiscal year ending March 2024–
25.00
Fiscal year ending March 2024
(Forecast)(Note) Revisions to the most recently announced dividend forecast: No

Fiscal year-end

Total

Yen
–

Yen
28.00

Yen
48.00

–

30.00

55.00

3. Forecast of Consolidated Financial Results for the Fiscal Year Ending March 31, 2024 (from April 1, 2023 to March 31, 2024)(Percentage figures indicate year-on-year changes)
Profit attributable to Basic earnings
Revenue
Operating profit
Ordinary profit
owners of parent
per share
Millionsofyen%Millions
of
yen
%
Yen
Millions of yen% Millions of yen%
Full year
8,000 53.9
1,120 20.0
1,065 14.8
725 17.3
118.58(Note) Revisions to the most recently announced earnings forecast: No* Notes(1) Changes in significant subsidiaries during the quarter (changes in specified subsidiaries resulting in change in scope of
consolidation): No(2) Application of accounting treatments specific to the preparation of quarterly consolidated financial statements: No(3) Changes in accounting policies, changes in accounting estimates, and restatement of prior period financial statements
1) Changes in accounting policies due to revisions to accounting standards and other regulations: No
2) Changes in accounting policies other than those in 1) above:No3) Changes in accounting estimates:

No4) Restatement of prior period financial statements:

No(4) Number of issued shares (common shares)
1) Total number of issued shares at the end of the period (including treasury shares)
As of September 30, 2023
6,608,977 shares As of March 31, 2023
4,623,000 shares
2) Number of treasury shares at the end of the period
As of September 30, 2023
4,156 shares As of March 31, 2023
46 shares
3) Average number of shares during the period (cumulative from the beginning of the fiscal year)
First two quarters ended
First two quarters ended September 30,
5,285,354 shares
4,581,115 shares
September 30, 2023
2022
* This summary of financial results is not subject to quarterly review procedures by a public accountant or audit corporation.
* Explanation regarding appropriate use of earnings forecasts, and other notes
The earnings outlook and other forward-looking statements contained in this document are based on information currently available
to and certain assumptions that are thought to be reasonable by the Company. Accordingly, such statements should not be
construed as a guarantee of achieving the results by the Company. Actual financial results and the like may differ materially due tovarious factors.

Contents of Attachment
1. Quarterly Consolidated Financial Statements and Major Notes ........................................................................................................... 2(1) Quarterly Consolidated Balance Sheets .......................................................................................................................................... 2(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income .................... 4
Quarterly Consolidated Statements of Income(Cumulative) ................................................................................................................................................................................ 4
Quarterly Consolidated Statements of Comprehensive Income(Cumulative) ................................................................................................................................................................................ 5(3) Quarterly Consolidated Statements of Cash Flows ......................................................................................................................... 6(4) Notes to Quarterly Consolidated Financial Statements .................................................................................................................. 7(Notes on Going Concern Assumption) ........................................................................................................................................... 7(Notes in Case of Significant Changes in the Amounts of Shareholder’s Equity) ............................................................................ 7(Segment Information, Etc.) ............................................................................................................................................................ 7(Business Combinations, Etc.) ......................................................................................................................................................... 8(Significant Subsequent Events) ...................................................................................................................................................... 9

1

1. Quarterly Consolidated Financial Statements and Major Notes(1) Quarterly Consolidated Balance Sheets(Thousands of yen)
Second quarter ofcurrent fiscal year
(As of September 30, 2023)

Previous fiscal year
(As of March 31, 2023)
AssetsCurrent assets
Cash and deposits

2,047,536

3,648,216

Accounts receivable - trade
Accounts receivable - other572,768418

783,255
4,709

Other
Allowance for doubtful accounts

41,291-

86,772(5,104)

2,662,015

4,517,849

46,334(2,464)

123,452(36,926)

43,86986,526

Tools, furniture and fixtures

47,859102,533

Accumulated depreciation(22,122)(71,288)

Tools, furniture and fixtures, net

25,736

31,245

Total property, plant and equipment

69,606

117,771

Total current assets
Non-current assets
Property, plant and equipment
Buildings
Accumulated depreciation
Buildings, net

Intangible assets
Goodwill-

1,622,307

17,193-

134,282
8,678

128

-

17,321

1,765,267

Investment securities
Deferred tax assets

20,90056,48335,900144,004

Guarantee deposits
Other

64,6931,300

179,879
1,837

-

(22)

Software
Software in progress
Trademark right
Total intangible assets
Investments and other assets

Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

2

143,377

361,598

230,305

2,244,638

2,892,320

6,762,488

(Thousands of yen)
Second quarter ofcurrent fiscal year
(As of September 30, 2023)

Previous fiscal year
(As of March 31, 2023)
Liabilities
Current liabilities
Current portion of long-term borrowings

22,500-Accounts payable - trade
Accounts payable - other

2,270
80,58875,025
216,185

Accrued expenses
Income taxes payable

283,333
216,116

316,411
146,404

Accrued consumption taxes
Deposits received

129,222
18,953

121,105
44,368

97

3,311
6,892

Provision for bonuses
Other

115,632-

120,260
28

Total current liabilities

868,715

1,049,992

Non-current liabilities
Deferred tax liabilities

11

-

11

-

868,726

1,049,992

Share capital
Capital surplus

508,034
400,028509,234
3,882,156

Retained earnings
Treasury shares

1,104,231(83)

1,312,321(6,814)

Total shareholders’ equity

2,012,210

5,696,897

11,383

15,5982,023,594

5,712,495

2,892,320

6,762,488

Contract liabilities
Refund liabilities

Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity

Share acquisition rights
Total net assets
Total liabilities and net assets3(2) Quarterly Consolidated Statements of Income and Quarterly Consolidated Statements of Comprehensive Income
Quarterly Consolidated Statements of Income(Cumulative)
First two quarters ofprevious fiscal year
(April 1, 2022 –September 30, 2022)
2,544,586(Thousands of yen)First two quarters ofcurrent fiscal year
(April 1, 2023 –September 30, 2023)
3,249,428

Cost of sales

1,641,310

1,899,103

Gross profit

903,276

1,350,325

Selling, general and administrative expenses

402,230

788,369

Operating profit

501,045

561,955

Revenue

Non-operating income
Interest income
Rental income from buildings
Subsidy income

8

41

-

555
279

Other

-

19

Total non-operating income

8895

Non-operating expenses
Interest expenses

488

37

Commission expenses
Other

206
-

51,375445

Total non-operating expenses

695

51,858500,358

510,992

Gain on reversal of share acquisition rights

759-

Total extraordinary income

759

-

2,873
7,687

-

Ordinary profit
Extraordinary income

Extraordinary losses
Loss on retirement of non-current assets
Office relocation expenses

10,560-

Profit before income taxes

Total extraordinary losses

490,557

510,992

Income taxes - current

145,665

128,734

Income taxes - deferred

5,728

44,725

Total income taxes

151,394

173,460

Profit339,163

337,532

Profit attributable to non-controlling interests
Profit attributable to owners of parent

4

-

-

339,163

337,532

Quarterly Consolidated Statements of Comprehensive Income(Cumulative)

ProfitOther comprehensive income
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

5(Thousands of yen)First two quarters ofprevious fiscal year
(April 1, 2022 –September 30, 2022)
339,163First two quarters ofcurrent fiscal year
(April 1, 2023 –September 30, 2023)
337,532--

339,163

337,532

339,163

337,532--(3) Quarterly Consolidated Statements of Cash Flows(Thousands of yen)First two quarters ofprevious fiscal year
(April 1, 2022 –September 30, 2022)

Cash flows from operating activities
Profit before income taxes

First two quarters ofcurrent fiscal year
(April 1, 2023 –September 30, 2023)

490,557

510,992

15,618-

16,63027,496

(8)
-

(41)
29

Loss on retirement of non-current assets
Share-based payment expenses

2,873
2,074

4,215

Gain on reversal of share acquisition rights
Relocation expenses

(759)
7,687

-

Decrease (increase) in trade receivables
Decrease (increase) in accounts receivable - other(1,675)
(394)

3,832
24,160

Increase (decrease) in trade payables
Increase (decrease) in accounts payable - other

3,255(3,441)

11,40453,150

Increase (decrease) in accrued expenses
Increase (decrease) in deposits received

6,926
2,443

912
(13,659)(8,651)(37,922)(19,464)(29,751)

Other, net

6,432

15,450Subtotal

Depreciation
Amortization of goodwill
Interest and dividend income
Foreign exchange losses (gains)

Increase (decrease) in provision for bonuses
Increase (decrease) in accrued consumption taxes

485,016

605,358

Interest and dividends received
Interest paid

8
(488)

41
(40)

Payments of relocation expenses
Income taxes paid

(7,687)(105,499)(197,418)

Net cash provided by (used in) operating activities

371,350

407,941

Cash flows from investing activities
Purchase of property, plant and equipment(55,726)(2,932)

Purchase of intangible assets
Proceeds from refund of guarantee deposits(2,501)
38,742(14,134)
2,826

Payments of guarantee deposits
Payments of asset retirement obligations(1,050)(11,230)(10)-Purchase of investment securities-(15,000)(31,765)(29,252)

2,700

2,400

(45,000)(183,216)(22,500)(129,442)-(6,731)

Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents(225,516)(156,273)-(29)

114,068

222,384

Cash and cash equivalents at beginning of period
Increase in cash and cash equivalents resulting frommergerCash and cash equivalents at end of period

1,724,844

2,047,536-

1,378,295

1,838,912

3,648,216

Net cash provided by (used in) investment activities
Cash flows from financing activities
Proceeds from issuance of shares resulting fromexercise of share acquisition rights
Repayments of long-term borrowings
Dividends paid
Purchase of treasury shares6(4) Notes to Quarterly Consolidated Financial Statements(Notes on Going Concern Assumption)
Not applicable.

(Notes in Case of Significant Changes in the Amounts of Shareholder’s Equity)
The Company merged with Interworks, Inc. as of August 1, 2023, and allotted and issued 0.205 shares of common stock ofConfidence for each share of common stock of Interworks. As a result of the merger, capital surplus increased by 3,480,927
thousand yen to 3,882,156 thousand yen as of the end of the second quarter of the current consolidated fiscal year.
(Segment Information, Etc.)[Segment information]
I. First two quarters of the previous fiscal year (April 1, 2022 – September 30, 2022)
1. Information on revenue and profit or loss and revenue breakdown by reportable segment(Thousands of yen)Amountrecorded inquarterly
Adjustments
statements of(Note 1)income(Note 2)

Reportable segment
HR Solution
business
Staffing,
Outsourcing

HR Solution
business
Recruitment

Staffing
Recruitment
Job advertisement
Outsourcing and other

2,385,432
110,308

21,715-27,1292,385,432
21,715
137,438-2,385,432
21,715
137,438

Sales to outside customers

2,495,741

21,71527,1292,544,586-

2,544,586

Inter-segment sales or transfers

10,531--

10,531(10,531)-Total

2,506,272

21,71527,1292,555,118(10,531)2,544,586

678,765

6,331

13,096698,193(197,147)

501,045

Media &
Solutionsbusiness

Total

Revenue

Segment profit(Notes) 1. Adjustments of segment profit (-197,147 thousand yen) include corporate expenses of 197,147 thousand yen thatare not allocated to each reportable segment.
2. Segment profit has been adjusted with the operating profit in the Quarterly Consolidated Statements of Income.
2. Information on impairment losses on non-current assets by reportable segment and goodwill
Not applicable.
II. First two quarters of the current fiscal year (April 1, 2023 – September 30, 2023)
1. Information on revenue and profit or loss and revenue breakdown by reportable segment(Thousands of yen)Amountrecorded in
Adjustments
quarterly(Note 1)statements ofincome(Note 2)

Reportable segment
HR Solution
business
Staffing,
Outsourcing

HR Solution
business
Recruitment

Staffing
Recruitment
Job advertisement
Outsourcing and other

2,657,432
103,192

256,996-

162,979
68,8272,657,432
256,996
162,979
172,020-

2,657,432
256,996
162,979
172,020

Sales to outside customers

2,760,624

256,996

231,8073,249,428-

3,249,428

-

-

-

-

-

-

2,760,624

256,996

231,8073,249,428-

3,249,428

728,02285,65753,050866,729(304,774)

561,955Media &
Solutionsbusiness

Total

Revenue

Inter-segment sales or transfers
Total
Segment profit(Notes) 1. Adjustments of segment profit (-304,774 thousand yen) include amortization of goodwill of 27,496 thousand yen
and corporate expenses of 277,277 thousand yen that are not allocated to each reportable segment.
2. Segment profit has been adjusted with the operating profit in the Quarterly Consolidated Statements of Income.
2. Information on changes in reportable segments, etc.
As of August 1, 2023, during the second quarter of the current fiscal year, the Company merged with Interworks, Inc.,the absorbed and dissolving company, and changed its name to Interworks Confidence Inc. As a result, the Group'sbusiness domain expanded significantly; from the second quarter of the current consolidated fiscal year. The reportable7

segment classification has been changed to “HR Solution business: Staffing/Outsourcing,” “HR Solution business:
Recruitment,” and “Media & Solutions business.”
The segment information for the first two quarters of the previous fiscal year has been reclassified based on the newreportable segment classifications.
3. Information on impairment losses on non-current assets by reportable segment and goodwill(Significant changes in the amount of goodwill)
As of August 1, 2023, the Company merged with Interworks, Inc., the absorbed and dissolving company, and changed its
name to Interworks Confidence Inc. The increase in goodwill due to this event was 1,649,804 thousand yen in the firsttwo quarters of the current consolidated fiscal year.
The amount of goodwill is tentatively calculated and not allocated to any reportable segment since the allocation of theacquisition cost has not been completed as of the end of the second quarter of the current fiscal year.
(Business combinations, etc.)(Business combination through acquisition)
The Company and Interworks, Inc. (“Interworks”) conducted an absorption-type merger with the Company as the absorbing
and surviving company and Interworks as the absorbed and dissolving company (the “Merger”), effective August 1, 2023,
and changed its trade name to “Kabushiki Kaisha Confidence Interworks” (English name: “Interworks Confidence Inc.”) on
the same day.
1. Summary of business combination(1) Name of the acquired company and its business
Name of the acquired company
Interworks, Inc
Media & Solutions business, recruitment business, hiring support
Business description
business(2) Main reason for the business combination
We aim to realize the benefits of the integration by focusing on “Expanding the business areas of the HR Solution
business/achieving business growth through cross-selling,” “Reinforcing the Media business,” and “Strengthening thebusiness management foundation and reducing administration costs.”(3) Date of business combination
August 1, 2023
(4) Legal format of the business combination
Absorption-type merger with the Company as the absorbing and surviving company and Interworks as the absorbed
and dissolving company(5) Company name after business combination”Kabushiki Kaisha Confidence Interworks”(English name: “Interworks Confidence Inc.”)(6) Percentage of voting rights acquired
Percentage of voting rights held immediately before the0%merger
Percentage of voting rights additionally acquired on the100%date of business combination
Percentage of voting rights after acquisition
100%(7) Main reasons for determining the acquiring company
Confidence was determined to be the acquiring company after comprehensively considering plural factors, including
the existence of differences in relative size, in addition to the fact that Confidence is the company that will issue theshares.
2. Period of the acquired company’s operating results included in the quarterly statement of income for the first two quartersof the current fiscal year
From August 1, 2023 to September 30, 2023
3. Acquisition cost of the acquired company and breakdown by type of consideration
The fair value of the Company’s common stock shares
3,480,927 thousand yen
issued on the date of business combination
Acquisition cost
3,480,927 thousand yen

84. Merger ratio by type of share, its calculation method, and number of shares issued(1) Merger ratio by type of share
The Company allotted and issued 0.205 shares of its common stock for each share of common stock of Interworks.
(2) Calculation method of merger ratio
In order to ensure the fairness of the merger ratio, it was determined that each company should separately request
an independent third-party appraiser to calculate the merger ratio. The Company selected SBI Securities Co., Ltd. andInterworks selected YAMADA Consulting Group Co., Ltd.
The Company and Interworks repeatedly conducted negotiations and discussions on the merger ratio in earnest, withreference to the calculation results, etc. received from the third-party appraisers they selected and in considerationof their respective financial conditions, performance trends and stock price trends, etc. Consequently, the twocompanies ultimately determined that the above merger ratio is appropriate and contributes to the interests of theirrespective shareholders, and agreed and determined the merger ratio.
(3) Number of shares issued
1,981,177 shares in common stock
5. Description and amount of major acquisition-related expenses
Fees and commissions for advisory services 52,890 thousand yen
6. Goodwill generated by merger, reason, amortization method and period(1) Goodwill generated by merger
1,649,804 thousand yen
The amount of goodwill is tentatively calculated since the allocation of the acquisition cost has not been completed
as of the end of the second quarter of the current fiscal year.
(2) Cause of occurrenceThis is the excess earning power expected from the future effects of business integration and business development.
(3) Amortization method and period
Equal amortization over 10 years
7. Amounts of assets received and liabilities assumed on the date of business combination and their main breakdown
Current assets
1,686,735 thousand yen
Non-current assets
432,713 thousand yen
Total assets
2,119,448 thousand yen
Current liabilities
288,325 thousand yen
Non-current liabilities
Total liabilities
288,325 thousand yen
8. Amount allocated to intangible assets other than goodwill and its breakdown by main typeNot applicable.
9. Estimated amount of impact of the business combination on the quarterly consolidated statements of income for thecurrent consolidated quarter as if the business combination had been completed on the first day of the consolidated fiscal
year and the method for calculating it
Not stated because it is difficult to calculate an estimated amount during the current quarterly consolidated accounting
period.
(Significant Subsequent Events)
Not applicable.

9