Translation
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any
discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results
for the Year Ended March 31, 2020
(Based on IFRS)

May 13, 2020

Company name:
Digital Garage, Inc.
Stock exchange listing: Tokyo
Securities code:
Representative:
Inquiries:

4819
URL https://www.garage.co.jp/
Representative Director,President Executive Officer and Group CEO
Member, Board of Directors,

Senior Managing Executive Officer
Scheduled date of ordinary general meeting of shareholders:

Kaoru Hayashi
Makoto Soda

TEL

03-6367-1111

June 23, 2020

Scheduled date to file Securities Report:
Scheduled date to commence dividend payments:

June 23, 2020
June 24, 2020

Preparation of supplementary material on financial results:
Holding of financial results meeting:

Yes
Yes

(for institutional investors and analysts)(Amounts are rounded off to the nearest million yen)
1. Consolidated financial results for the year ended March 31, 2020 (from April 1, 2019 to March 31, 2020)(1) Consolidated operating results
RevenueYear ended March 31,
2020
Year ended March 31,
2019Profit before tax
Millions ofyen

Percentages indicate year-on-year changes
Profit attributable Comprehensive
to owners of parent
incomeMillions ofMillions%%%
yenof yen

ProfitMillions ofyen%

36,936

3.5

10,008 (25.4)

7,331 (25.1)

7,420 (24.1)

6,345 (33.3)

35,68739.9

13,424

9,790

9,771

9,515

%

60.3

Millions ofyen

54.5

52.4

49.4

Return on equity
Ratio of profit before Ratio of operating
attributable toprofit to revenue
tax to total assets
owners of parent
Yen
Yen%%%
Year ended March 31, 2020
161.37147.82
15.0
6.5
27.1
Year ended March 31, 2019
210.28199.26
21.9
10.1
37.6
(Note. Revenue and profit before tax represent the amount of continuing operations only.)
Basic earnings per Diluted earnings per
shareshare(2) Consolidated financial position
Total assets

As of March 31, 2020
As of March 31, 2019(3) Consolidated cash flows

Year ended March 31, 2020
Year ended March 31, 2019

Millions of yen
162,296
146,890

Ratio of equity
Equity attributable toEquity attributable to attributable to owners
owners of parent per
owners of parentof parent to total
shareassetsMillions of yen
Millions of yen%
Yen
52,79552,03332.1
1,130.75
47,34546,60931.7
1,014.34

Total equity

Cash flows fromoperating activities
Millions of yen(12,322)
2,580

Cash flows frominvesting activities
Millions of yen(5,473)(2,397)1

Cash flows from
Cash and cash equivalents
financing activities
at end of period
Millions of yen
Millions of yen
2,363
32,702
8,509
48,154

2. Cash dividends
Annual dividends per share
1st quarter-end 2nd quarter-end 3rd quarter-end Fiscal year-end
Yen

Yen

Total cash
dividends

Total

Dividend payout
ratio

Ratio of dividends
to equity
attributable toowners of parent

Yen

Yen

Yen

Millions of yen%%

Year ended March 31, 2019–0.00–
Year ended March 31, 2020
–0.00–
Year ending March 31, 2021–––
(Forecast)(Note 1. Breakdown of year-end dividends for the year ended March 31, 202010.00 Yen)
(Note 2. Fiscal year ending March 31, 2021 forecast is to be determined.)

28.00
38.00

28.00
38.00

1,287
1,749

13.3
23.5

2.9
3.5–––

Ordinary dividend: 28.00 Yen

Commemorative dividend:

3. Consolidated Earnings Forecast for the Fiscal Year Ending March 31, 2021 (April 1, 2020 to March 31, 2021)
In the field of investment and incubation in domestic and overseas unlisted companies in the Incubation Technology Segment, it is difficult toreasonably estimate the fair value of securities held by Digital Garage Group at the end of the fiscal year. Therefore, Digital Garage, Inc. does notdisclose consolidated financial forecasts.
4. Notes(1) Changes in significant subsidiaries during the year ended March 31, 2020(changes in specified subsidiaries resulting in the change in scope of consolidation):(2) Changes in accounting policies and changes in accounting estimates
Changes in accounting policies required by IFRS:
Changes in accounting policies due to other reasons:
Changes in accounting estimates:––––(3) Number of issued shares (ordinary shares)
Total number of issued shares at end of period (including treasury shares)
As of March 31, 2020

47,406,800 shares As of March 31, 201947,341,600 shares

1,390,316 shares As of March 31, 2019

1,391,452 shares

45,982,461 shares Year ended March 31, 201946,465,122 shares

Number of treasury shares at end of period
As of March 31, 2020
Average number of shares during period
Year ended March 31, 20202

Consolidated financial statements
Consolidated statement of financial position(Millions of yen)
As of March 31, 2019

As of March 31, 2020

AssetsCurrent assets
Cash and cash equivalents

48,15432,702

Trade and other receivables
Inventories

23,254232

26,657319

Operational investment securities
Other financial assets

26,695451

36,546
1,3236394

324
980

99,18698,852

Property, plant and equipment
Goodwill

9,421
6,575

21,367
7,689

Intangible assets
Investment property

2,575
3,046

3,496
2,932

Investments accounted for using equity method
Other financial assets

19,1396,662

21,475
6,319

Deferred tax assets
Other non-current assets

137
148

45
120

Total non-current assets

47,70463,444

146,890

162,296

Income taxes receivable
Other current assets
Total current assets
Non-current assets

Total assets3

(Millions of yen)
As of March 31, 2020

As of March 31, 2019Liabilities and equity
Liabilities
Current liabilities
Borrowings

2,211

4,927

Trade and other payables
Other financial liabilities

45,799853

41,203
1,783

Income taxes payable
Other current liabilities

1,076
2,482

207
2,717

Total current liabilities

52,42050,838

Bonds and borrowings
Other financial liabilities

35,9595,430

38,247
13,553Retirement benefit liability
Provisions

565
321

571
589

Deferred tax liabilities
Other non-current liabilities

4,744
106

5,426
278

Total non-current liabilities

47,12558,66399,545109,501

Share capital
Capital surplus

7,504
4,235

7,591
4,409

Treasury shares
Other components of equity(5,026)
1,303(5,012)324

Retained earnings

38,59344,721

Total equity attributable to owners of parent

46,60952,033

Non-current liabilities

Total liabilities
EquityNon-controlling interests
Total equity
Total liabilities and equity

4736

762

47,34552,795

146,890

162,296

Consolidated statements of income and consolidated statements of comprehensive income
Consolidated statements of income
Fiscal year ended(Millions of yen)
Fiscal year endedMarch 31, 2019

March 31, 2020

Continuing operations
Revenue in recurring business
Revenue in operational investment securities

22,713
6,090

26,687
4,020

Other income
Finance income

1,933
117

2,416
93

Share of profit of investments accounted for using equity
method

4,835

3,720

Total

35,68736,936

Cost of sales

10,401

12,036

Selling, general and administrative expenses
Other expenses

11,296332

14,022
492

Finance costs

235

379

Total

22,26426,929Profit before tax
Income tax expense

13,424
4,088

10,008
2,677

Profit from continuing operations

9,3367,331

1,261

–

Expenses

1,655–

Profit (loss) before tax from discontinued operations
Income tax expense

(394)
(225)

–
–

Profit (loss) after tax from discontinued operations
Gain (loss) on sales on discontinued operations

(169)
898

–
–

Income tax expense from sale of discontinued operations

275–

Profit from discontinued operations

454

–

9,790

7,331

Profit (loss) attributable toOwners of parent

9,771

7,420

Non-controlling interests

19(89)

Continuing operations
Discontinued operations

199.9310.35

161.37–

Total

210.28161.37

Diluted earnings per share
Continuing operations

189.51147.82

Discontinued operations

9.75

–

199.26147.82

Discontinued operations
Revenue

ProfitEarnings per share
Basic earnings per share

Total

5

Consolidated statements of comprehensive income

ProfitFiscal year ended(Millions of yen)
Fiscal year ended

March 31, 2019

March 31, 2020
9,790

7,331(439)

(817)

(3)

1

8(64)

159(104)(0)(2)

Total other comprehensive income(loss)

(275)

(986)

Comprehensive income

9,515

6,345

9,499
16

6,435
(90)

Other comprehensive income
Items that will not be reclassified to profit or loss
Net change in fair value of equity instruments designatedas measured at fair value through other comprehensive
incomeRemeasurements of defined benefit plans
Share of other comprehensive income of investments
accounted for using equity method
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Share of other comprehensive income of investments
accounted for using equity method

Comprehensive income(loss) attributable toOwners of parent
Non-controlling interests

6Consolidated statement of changes in equity(Millions of yen)
Equity attributable to owners of parentOther components of equity
Financial assets

Share

CapitalTreasury

capitalsurplussharesmeasured atfair value
through othercomprehensive
incomeBalance at April 1, 2018
Profit7,465

3,748(26)

Other comprehensive income
Comprehensive income
Issuance of new shares–
39

Changes in ownership interest in
subsidiaries–
39–

Exchangedifferencesontranslationof foreign
operations

Remeasurements

Totalof defined
benefit plans

504

1,071

0

1,575
–

(428)

159

(3)

(272)

(428)

159

(3)

(272)
–

(491)

–

Change in scope of consolidation
Dividends––

Share-based remunerationtransactions

231–

Forfeiture of share acquisitionrights

6–

Purchase of treasury shares
Issue of convertible bonds

(5)
703

(5,000)Transfer from other components ofequity to retained earnings(0)

OtherTotal
Balance at March 31, 2019

5–

487

(5,000)

(0)

––

(0)

7,504

4,235(5,026)

75

1,231

(3)

1,303–(985)–88Changes in ownership interest in
subsidiaries
Change in scope of consolidation
Dividends
Share-based remunerationtransactions
Purchase of treasury shares
Disposal of treasury shares

–88–

(106)

1(880)(106)

1(985)––(62)

––

145

–(0)
14(0)

––
6

Other
Balance at March 31, 2020

(880)

1

Transfer from other components ofequity to retained earnings
Total

(0)

39

ProfitOther comprehensive income
Comprehensive income
Issuance of new shares

––

6

2–

88

174

146

–

–

6

7,591

4,409

(5,012)(798)

1,125(2)324

7

(Millions of yen)
Equity attributable to owners of parent
Retained earnings
Balance at April 1, 2018
Profit

(272)

(3)

(275)

9,771

9,499

16

9,515

77

subsidiaries
Change in scope of consolidation(1,133)transactions
Forfeiture of share acquisitionrightsPurchase of treasury shares
Issue of convertible bonds
Transfer from other components ofequity to retained earnings
OtherTotal

483
19

Total

42,7179,771

Issuance of new shares
Changes in ownership interest in

Dividends
Share-based remunerationinterests

29,955
9,771

Other comprehensive income
Comprehensive income

Non-controlling

Total

0

43,199
9,790

77

(491)

937

446

–

(638)

(638)

(1,133)(61)(1,194)231

231

66(5,005)(5,005)

703

703

––

5

5(1,132)(5,607)238(5,369)38,593
7,420

46,609
7,420

736
(89)

47,345
7,331

(985)

(1)

(986)

6,435
175

(90)

6,345
175

Changes in ownership interest insubsidiaries

1116

116

Change in scope of consolidation
Dividends(62)(1,287)(62)(1,287)

Share-based remunerationtransactions

145

145

Purchase of treasury shares
Disposal of treasury shares

(0)
14(0)
14––

2

2

Balance at March 31, 2019
ProfitOther comprehensive income
Comprehensive income
Issuance of new shares

Transfer from other components ofequity to retained earnings

7,420(1,287)(6)

OtherTotalBalance at March 31, 2020

(1,293)(1,011)

116

(895)

44,721

52,033762

52,7958Consolidated statements of cash flows
Fiscal year ended(Millions of yen)
Fiscal year ended

March 31, 2019

March 31, 2020

Cash flows from operating activities
Profit before tax
Depreciation and amortization

13,424
1,952

10,0082,369

Impairment losses
Interest and dividend income

36(23)

65(22)

Interest expenses on borrowings and bonds
Share of loss (profit) of investments accounted for using

235

249

(4,835)(3,720)(1,152)(1,283)(3,459)(10,085)(3,195)(9,810)

(50)
6,719

(87)
(5,715)equity method
Loss (gain) on sales of shares of subsidiaries and associates
Decrease (increase) in trade and other receivables
Decrease (increase) in investment securities for sale
Decrease (increase) in inventories
Increase (decrease) in trade and other payables
Other161(223)

SubtotalInterest and dividends received

2,923
1,312

(11,363)1,664Interest paid
Income taxes refund (paid)(150)(1,694)(91)(2,532)

189

–

2,580

(12,322)Net cash provided by (used in) operating activities fromdiscontinued operations
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment(1,265)(3,494)(1,213)(2,587)(1,749)(4)949–0(1,043)

Proceeds from sale of subsidiaries
Purchase of investments accounted for using equity method

1,072(1,388)–(500)

Proceeds from sale of investments accounted for using equity
method

2,033

1,462

Payments of leasehold and guarantee deposits
Other(50)84(792)646

Net cash provided by (used in) investing activities fromdiscontinued operations

(34)

–

(2,397)(5,473)Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Payments for acquisition of subsidiaries

Net cash provided by (used in) investing activities

9Fiscal year ended(Millions of yen)
Fiscal year ended

March 31, 2019

March 31, 2020

Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings

(109)
–82
5,300

(9,836)25,161(511)–

Repayments of lease liabilities
Capital contribution from non-controlling interests

(867)
422

(1,435)
116

Payments for acquisition of interests in subsidiaries from
non-controlling interests

(137)

–

28–

(5,005)(1,073)(0)(1,289)

(14)

101

(60)

–

8,509

2,363

Repayments of long-term borrowings
Proceeds from issuance of bonds with share acquisition rights

Proceeds from sale of interests in subsidiaries to noncontrolling interests
Purchase of treasury shares
Dividends paid
Other
Net cash provided by (used in) financing activities fromdiscontinued operations
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

12(20)

8,704(15,452)

Cash and cash equivalents at beginning of period

39,45048,154

Cash and cash equivalents at end of period

48,15432,70210