BRIEF STATEMENT OF CONSOLIDATED FINANCIAL RESULTS
FOR THE 2nd QUARTER OF THE FISCAL YEAR ENDING MARCH 2023
This is an English translation of summarized consolidated financial results prepared
for the convenience of non-resident shareholders. Should there be any inconsistency
between the translation and the official Japanese text, the latter shall prevail.

November 14, 2022
Faith, Inc. (Stock code 4295, Listed on TSE Prime Section)(URL http://www.faith.co.jp/)
Representative: Hajime Hirasawa, CEO/President
Contact: Chikayo Suzuki, CFO/Executive Officer
Tel: +81-3-6855-7811
Date of Submission of Securities Report: November 14, 2022
Starting Date of the Dividend Payment: December 8, 2022
Preparation of Supplementary Materials for Quarterly Financial Results: Applicable
Information Meeting for Quarterly Financial Results to be Held: None
Amounts are rounded down to the nearest JPY 1 million.

1. Results for the 2nd Quarter of the Fiscal Year Ending March 2023
(From April 1, 2022 to September 30, 2022)(1) Consolidated Operating Results (cumulative totals)(Percentages indicate changes compared with the same quarter of the previous fiscal year.)

Net Sales
Millionsof yenOperating Income%

Millionsof yenOrdinary Income%

Millionsof yen%Net Income
Millionsof yen%Year ending March 2023 Q2

7,299

1.2

△240

－

△218

－

△263

－

Year ending March 2022 Q2

7,212

△27.9

96

△82.5

234

△64.9

53

△83.2

(Note) Comprehensive income: 2nd quarter of the fiscal year ending March 2023: △¥64 million (—%); 2nd quarter of fiscal year ending
March 2022: ¥78 million (—%)

Net Income per Share

Diluted Net Income per ShareYen△23.64
4.20

Year ending March 2023 Q2
Year ending March 2022 Q2

Yen
—
—

(2) Consolidated Financial Position
Total Assets
Year ending March 2023 Q2
Year ending March 2022

Net Assets

Ratio of Equity CapitalMillions of yen

Millions of yen

24,551
25,29115,801
17,117

%
64.4
67.7

(Reference) Equity capital: 2nd quarter of fiscal year ending March 2023: ¥15,801 million; fiscal year ending March 2022: ¥17,117 million

2. Dividends
Dividends per Share
(Record dates)

Year ending March 2022
Year ending March 2023
Year ending March 2023
(Forecast)

1st Quarter

Yen
—
—

3rd Quarter

Interim

Yen
5.00
5.00

Year-end

Yen
5.00

Yen
10.00

—

5.00

10.00

(Note) These figures have not been modified since the time of the most recently announced dividend forecast.

1

Total

Yen
—

3. Forecast for the Consolidated Results for the Year Ending March 2023
（from April 1，2022 to March 31，2023）(Percentages indicate changes compared with the previous fiscal year.)

Net Sales

Full year

Operating Income

Ordinary Income

Net Income
Attributable to the
Shareholders of the
Parent Company

Millionsof yen%Millionsof yen%Millionsof yen%Millions ofyen%

17,000

11.0

350

—

345

152.0

295

－

Net Income
per Share

Yen
26.86

(Note) These figures have not been modified since the time of the most recently announced business result forecast.

* Notes(1) Changes in significant subsidiaries (accompanying changes in scope of consolidation): None
Newly added subsidiaries: 0 companies (subsidiary’s name:)Removed subsidiaries: 0 companies (subsidiary’s name:)(2) Adoption of simplified accounting practices or specific procedures in preparation of the quarterly
consolidated financial reports: None
(3) Changes in accounting policy, changes in accounting estimates, and restatements(i)
Changes accompanying revisions of accounting standards, etc.: Applicable(ii) Changes other than the above: None(iii) Changes in accounting estimates: None(iv)

Restatements: None

(Note) For details, please refer to “2. Consolidated Financial Statements and Important Explanatory Notes, (4) Notes Concerning theConsolidated Financial Statements (Changes in Accounting Policies)” on page 12 of the accompanying material.

(4) Outstanding shares (common shares)(i) Outstanding shares at the end of the term (including treasury shares):
The 2nd quarter of the fiscal year ending March 2023: 13,831,091 shares
The fiscal year ending March 2022: 13,831,091 shares(ii) Treasury shares at the end of the term:
The 2nd quarter of the fiscal year ending March 2023: 1,198,938 shares
The fiscal year ending March 2022: 2,999,557 shares(iii) Average number of shares during the interim accounting period:
The 2nd quarter of the fiscal year ending March 2023: 11,131,726 shares
The 2nd quarter of the fiscal year ending March 2022: 12,632,813 shares(Note) The number of shares of treasury stock at the end of the period includes the Company's shares (257,200 shares in Q2 of the
fiscal year ending March 2023, 257,200 shares in the fiscal year ending March 2022) contributed as trust assets in theperformance-based stock compensation plan). In addition, such shares are also included in the treasury shares that are deductedin calculating the average number of shares during the accounting period (257,200 shares in Q2 of the fiscal year ending March
2023, 257,200 shares in Q2 of the fiscal year ending March 2022)* This financial results report is exempt from quarterly review procedures.
* Statement regarding the proper use of financial forecasts and other special remarks(Notice regarding statements concerning the future)
Statements concerning the future, such as performance forecasts, etc., described in the present material are based on
information currently available to the Company and on certain assumptions judged as reasonable by the Company. The
Company’s actual performance may differ substantially from these forecasts as a result of various factors beyond theCompany’s control. For details of cautions, etc., employed in making performance forecasts and the assumptions underlying
performance forecasts, please refer to “1. Qualitative Information Concerning the Settlement of Accounts for the 2nd Quarter,(3) Explanation Concerning Future Forecast Information on the Consolidated Financial Results, etc.” on page 5 of theaccompanying material.
(To obtain supplemental documents relating to financial results)
Supplemental information on the Company’s quarterly financial results will be posted on the company website on November
30, 2022.

2

Accompanying Material — Contents
1. Qualitative Information Concerning the Settlement of Accounts for the 2nd Quarter ····················(1) Explanation Concerning the Operating Results ····························································(2) Explanation Concerning the Financial Position ····························································(3) Explanation Concerning Future Forecast Information on the Consolidated Financial Results, etc. ··

2
2
4
5

2. Consolidated Financial Statements and Important Explanatory Notes ······································ 6(1) Consolidated Balance Sheet ···················································································· 6(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income ········ 8(Consolidated Statement of Income) ·········································································· 8(Consolidated Statement of Comprehensive Income)······················································· 9(3) Consolidated Statement of Cash Flows ······································································· 10(4) Notes Concerning the Consolidated Financial Statements ················································· 12(Note Concerning the Premise of a Going Concern) ························································ 12(Note in the Case of Significant Changes in the Amount of Shareholders’ Equity) ··················· 12(Changes in Accounting Policies) ············································································ 12(Additional Information) ······················································································ 12(Segment Information) ························································································· 12

1. Qualitative Information Concerning the Settlement of Accounts for the 2nd Quarter(1) Explanation Concerning the Operating Results
In the Japanese information and communications field in 2021, the Internet penetration rate remained
high at 82.9%, while the percentage of households owning one or more smartphones increased to 88.6%,
greatly exceeding the 69.8% of households owning one or more personal computers (*1). In addition, while
the movement away from television has continued since the year 2000, mainly centered on the young,
advertising expenses for the Internet in Japan increased by 21.4% in 2021 from the previous year to¥2,705.2 billion, exceeding the combined advertising expenses for the four largest mass media sectors(newspapers, magazines, radio, and television) of ¥2,453.8 billion (*2). This trend is also evident
worldwide, where in 2022 global spending on digital advertising is expected to reach approximately ¥54
trillion (US$409.9 billion), an increase of 14.2% from the previous year, with spending on digitaladvertising exceeding 55.5% of total spending on advertising (*3).
*1. Source: Ministry of Internal Affairs and Communications, 2021 Telecommunications Usage Trend Survey Results*2. Source: Dentsu Inc., 2021 Advertising Expenditures in Japan*3. Source: Dentsu Group Inc., Global Ad Spend Forecasts (2022-2024)

In the entertainment market in 2021, sales in the global music market centered on streaming services grewby 18.5% year over year to approximately ¥3,367 billion (US$25.9 billion), marking its seventh
consecutive year of growth and recording its highest sales total since the beginning of this century (*4). In
Japan, the production value of music software including music videos was almost unchanged from theprevious year at ¥193.6 billion, and while sales of packaged products continued to decline, paid music
distribution sales increased by 14% to ¥89.5 billion. In the paid music distribution sales category,subscription audio streaming increased by 26% year over year to ¥74.4 billion, accounting for 83% of
total paid music distribution sales (*5).
The impact of the novel coronavirus infection forced the postponement or cancellation of major eventsand live concerts, causing the live entertainment market to shrink by 82.4% from its 2019 level to ¥110.6
billion in 2020. In 2021, music events in real venues began to resume in line with the government's
guidelines for infection prevention measures, and the market size showed signs of recovery to ¥307.2
billion, although this was still 51.2% below the 2019 level (*6). Meanwhile, new ways of enjoying live
entertainment are taking root, with many artists offering “hybrid performances” in which a limited
audience is allowed into the venue and the performance is also distributed online. With live performancesin front of various audience sizes being streamed, the scale of the pay-per-view online live performancemarket was estimated at ¥44.8 billion in 2019, rising to an estimated ¥51.2 billion in 2021 (*7).
*4. Source: IFPI, Global Music Report 2022
*5. Source: Recording Industry Association of Japan (RIAJ), The Recording Industry in Japan 2022
*6. Source: PIA Research Institute, Japanese Live Entertainment Market Size Confirmed Report (published June 15, 2021)*7. Source: PIA Research Institute, Japanese Online Live Entertainment Market Survey (published June 15, 2022)

Founded in 1992, Faith was the first company in the world to commercialize ringtones, and has steadilygrown centered on the music distribution business and in step with the popularization of mobile phones.
However, in the current music market, with the spread of smartphones, the music industry is facing asituation in which all manner of activities, including content distribution methods, consumption styles,
and content production methods, are changing as media such as streaming, user upload content (UUC)—
which allows general users to easily transmit information to society, and social media become morediverse.
In this environment, the Faith Group is continuing to utilize the results of the efforts it has been pouring
into digital content distribution ever since its establishment, and is forging ahead with its Multi-Content
and Multi-Device Strategy of creating environments in which people can enjoy a wide diversity ofcontents whenever and wherever they choose. We are also strengthening the development of new services
in response to the changing market environment, which include platforms that collect and organize theinformation flooding the Internet and provide this to users after increasing its added value.
In June 2020, Faith released Thumva, a new live streaming platform, as an Internet viewing service thatprovides a novel kind of live experience. In addition to group viewing and comment posting, Thumva
includes a gifting function for artists, allowing users to share a sense of excitement and togetherness as if
they were attending a live concert. In addition to live performances by a slew of artists, a diverse lineup
of backstage and other events and online interactive attractions have already been made available on2

Thumva, and a variety of other content is scheduled to be distributed in the future.
In July 2021, utilizing Thumva’s resources, we launched Thumva BIZ as a new online service for storesthat allows customers who wish to make inquiries or seek consultations online begin business negotiations
with a single click. Our proposal consists of an online retail store service that meets the needs of the ageof digital transformation, and the service has already been introduced by companies in a variety ofindustries as well as in the form of a business negotiation system for online exhibitions. Thumva BIZ willcontinue to expand its sales channels as a new DX service for stores in a wide range of fields, andparticularly in face-to-face customer service industries.
In anticipation of changes in behavior patterns and the establishment of new values, the Faith Group has
established a permanent teleworking system and consolidated its main office functions in the Minami
Aoyama Office. We are also actively engaged in a company-wide effort to reestablish and activate crosscompany communication. Going forward, we will continue to pursue more flexible workstyles and realize
new, diverse, and efficient ways of working.
Regarding the Faith Group’s business performance for the second quarter of the consolidated fiscal year
ending March 2023, the Group reported an increase in net sales of 1.2% year over year to ¥7,299 million,
an operating loss of ¥240 million (compared with an operating income of ¥96 million for the same periodof the previous year), an ordinary loss of ¥218 million (compared with an ordinary income of ¥234 million
for the same period of the previous year), and a net loss attributable to the owners of the parent of ¥263
million (compared with a net income attributable to the owners of the parent of ¥53 million for the same
period of the previous fiscal year).
Information on each business segment is as follows.
Historically, the Faith Group has had three reportable segments: the Content Business, the Point Service
Business, and the Label Business. However, after reassessing its business management decision-making
and performance classifications, with effect from the first quarter of the current consolidated fiscal year,
the Group has begun operate under two reportable segments: the Platform Business and the Content
Business.
Please note the comparative analysis with the previous second quarter consolidated cumulative period isbased on the segment classifications adopted following the change.
Platform BusinessIn the Platform Business, as sales in existing distribution businesses continue to decline, we will continue
to invest in new growth areas by linking and platforming each of our services with the aim of developing
new and innovative products and grasping diversified profit opportunities.
Through FaRao PRO, we are focusing not only on providing BGM for commercial use, but also on
actively developing sales activities centered on the expansion of functions necessary for store operations,such as solutions that propose store branding as well as announcement functions. In the future, we willcontinue to aim at the creation and activation of a new BGM market.
In Fans’, our platform of services for artists based on the D2C (*8) business model, which is expected to
expand further in future, we are enhancing the functions essential to artists’ musical activities such as
official website construction, music and video distribution, sales of artists’ goods, and fan club operation.
By improving linkage with SNS, we have introduced a system that allows fans to contribute to the creationof a community by spreading the information that creators send out. Furthermore, by offering a service
that allows more artists to freely disseminate their work and information, we are aiming to expand ouruser base and improve the quality of the service by pursuing enhanced convenience.
*8. Abbreviation of “Direct to Consumer”—a business model for delivering services and products planned and manufactured by Faith directly to users

In addition, the Retail Point System Operation Platform allows retailers to operate point issuing systems
and other services, and also offers total support from planning to operation as a series of cycles of point
issuance data acquisition, analysis, and sales promotion utilization, as well as providing outsourcing
services to maximize sales promotion efficiency in the retail industry.

3Regarding the performance of this segment for the cumulative second quarter of the current consolidated
fiscal year, due to a decrease in sales of carrier official website services for mobile phone content
distribution and a decrease in point issuance to existing member stores in the Retail Point System
Operation Platform, the Platform Business recorded net sales of ¥1,068 million (a decrease of 19.9% year
over year), and a segment loss of ¥168 million (compared with a segment income of ¥66 million in thesame period of the previous year).
Content BusinessIn the Content Business, we are proceeding with the strengthening of new businesses with a view to the
future in order to overcome our dependence on sales of packaged products in view of the severe
environment faced by the music and video-related industries in the changing music market.
Regarding the performance of this segment, net sales increased by 6.0% year over year to ¥6,230 million,
mainly due to an increase in activities by affiliated artists, a recovery of sales related to the use of soundsources, and an increase in sales of exclusive mail-order products amid signs of recovery in theentertainment market. However, net income in this segment decreased by 39.2% year over year to ¥112
million due mainly due to the postponement of releases of large-scale works.
*Product and service names appearing in this document are trademarks or registered trademarks of Faith, Inc. either in Japan or in othercountries.

(2) Explanation Concerning the Financial Position(Analysis of Financial Position)
As of the end of the second quarter of the current consolidated fiscal year ending March 2023 (September
30, 2022), total assets decreased by ¥740 million compared to the end of the previous consolidated fiscal
year to ¥24,551 million. This result was mainly due to a decrease in cash and deposits of ¥757 million, adecrease in notes and accounts receivable of ¥322 million, and an increase in investment securities of¥433 million.
Total liabilities increased by ¥575 million compared to the end of the previous consolidated fiscal year to¥8,749 million. This result was mainly due to an increase in long-term debt.
Net assets decreased by ¥1,315 million compared to the end of the previous consolidated fiscal year to¥15,801 million. This was mainly due to the acquisition of treasury stock.
As a result of the above, the equity ratio decreased by 4.5 percentage points to 64.4%.
(Cash Flow Situation)
The balance of cash and cash equivalents at the end of the second quarter of the current consolidated fiscal
year stood at ¥10,729 million, a decrease of ¥755 million from the end of the previous consolidated fiscal
year. Details of cash flow for the consolidated cumulative second quarter and its contributory factors are
as follows:(Cash Flows from Operating Activities)
Cash flows from operating activities amounted to an outflow of ¥539 million (compared with an inflowof ¥127 million for the same period of the previous fiscal year), due mainly to the recording of ¥216
million in respect of a loss before income taxes, ¥436 million in respect of a decrease in trade receivables,and ¥643 million in respect of a decrease in trade payables, etc.
(Cash Flows from Investing Activities)
Cash flows from investing activities amounted to an outflow of ¥231 million (compared with an outflow
of ¥103 million for the same period of the previous fiscal year), due mainly to the recording of ¥267
million in respect of expenditure for the purchase of property, plant and equipment, ¥49 million in respectof expenditure for the purchase of software, and ¥126 million in respect of proceeds from the refund ofleasehold deposits, etc.
(Cash Flows from Financing Activities)
Cash flows from financing activities amounted to an inflow of ¥15 million (compared with an outflow of4¥194 million for the same period of the previous fiscal year), due mainly to the recording of ¥1,450 million
in respect of income from long-term borrowing and ¥1,300 million in respect of expenditure for purchaseof treasury shares.

(3) Explanation Concerning Future Forecast Information on the Consolidated Financial
Results, etc.
Performance forecasts are made based on information currently available to the Company, but there is apossibility that the actual performance figures will differ significantly from the forecast figures due to avariety of factors. In addition, the current performance forecast for the full financial year is unchanged
from the forecast issued on May 13, 2022.

5

2. Consolidated Financial Statements and Important Explanatory Notes(1) Consolidated Balance Sheet(Unit: thousands of yen)(Thousands of yen)
As of March 31, 2022
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Contract assets
Marketable securities
Merchandise and finished goods
Work in process
Raw materials and supplies
Income taxes refundable
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term borrowings
Current portion of long-term borrowings
Accounts payable - otherAccrued expenses
Income taxes payable
Provision for bonuses
Contract liabilities
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Retirement benefit liabilities
Provision for share awards for directors (and otherofficers)
Asset retirement obligations
Deferred tax liabilities
Other
Total non-current liabilities
Total liabilities

6

As of September 30, 2022

11,536,650
2,046,903
370
224,003
336,103499,421104,241
141,976
639,337△18,325
15,510,681

10,779,194
1,723,996
1,640
219,580
345,453
633,715
59,0290909,843△23,250
14,649,202

3,454,136

3,656,272

1,270,938
386,399
1,657,338

1,209,559
382,324
1,591,884

3,528,354
705,202
1,071,430△635,348
4,669,638
9,781,112
25,291,794

3,962,199
244,554
1,097,380△650,134
4,653,999
9,902,155
24,551,358

1,401,065
340,000
217,700
678,160
2,888,759
119,451
238,261
49,569689,1096,622,077

757,473
390,000
568,300
645,065
2,932,273
56,308240,460
43,048887,650
6,520,580

162,150
542,544

1,141,400
545,333

39,691

43,27439,283765,118
3,191
1,551,979
8,174,057

39,283456,601
2,923
2,228,815
8,749,395

(Thousands of yen)
As of March 31, 2022
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
Foreign currency translation adjustment
Accumulated retired benefit adjustment
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

7

As of September 30, 2022

3,218,000
2,840,498
10,393,392△1,122,330
15,329,560

3,218,000
2,840,496
10,050,266△2,422,337
13,686,425

1,740,714△8,881
56,343
1,788,177－
17,117,737
25,291,794

2,065,633△8,872
58,776
2,115,537－
15,801,962
24,551,358

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income(Consolidated Statement of Income)(Thousands of yen)Six months ended
September 30, 2021
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Dividend income
Interest on securities
Share of profit of entities accounted for using equity
methodGain on investments in investment partnerships
Foreign exchange gains
Subsidy income
Miscellaneous income
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodLoss on investments in investment partnerships
Loss on valuation of securities
Miscellaneous expenses
Total non-operating expenses
Ordinary income (loss)
Extraordinary income
Gain on sale of investment securities
Gain on sale of non-current assets
Total extraordinary income
Extraordinary losses
Loss on disposal of non-current assets
Loss on liquidation of subsidiaries
Loss on valuation of investment securities
Total extraordinary losses
Net income (loss) before income taxes
Income taxes - current
Income taxes - deferred
Net income (loss)
Net income (loss) attributable to owners of parent

8

Six months ended
September 30, 2022

7,212,575
4,292,650
2,919,924※ 2,823,196
96,7287,299,265
4,534,194
2,765,071※ 3,006,033△240,961

59
2,586
5

52
3,203
52

29,198－

116,57683
54,00015,253
217,763

569
275
42,286
4,430
50,869

2,362

3,133

－

8,480

76,524372
664
79,923
234,568

9,916
6,135
421
28,086△218,178

34,114141
34,255

－
2,019
2,019

42
29,75627,21457,013211,810
155,758
2,988
53,06453,064541－－
541△216,700
37,2109,295△263,206△263,206

(Consolidated Statement of Comprehensive Income)(Thousands of yen)Six months ended
September 30, 2021
Profit (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Retirement benefit adjustment (before any applicabletax effect)
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

9

Six months ended
September 30, 2022

53,064△263,206△163,856
21,937

324,918
9

10,314

2,433△131,604△78,540

327,360
64,153△78,540

64,153－－

(3) Consolidated Statement of Cash Flows(Thousands of yen)Six months ended
September 30, 2021
Cash flows from operating activities
Profit (loss) before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for point cardcertificates
Increase (decrease) in retirement benefit liability
Increase (decrease) in provision for share awards for
directors (and other officers)
Interest and dividend income
Loss (gain) on valuation of securities
Interest income on securities
Interest expenses
Subsidy income
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using
equity method
Loss (gain) on investments in investment partnerships
Loss (gain) on liquidation of subsidiaries
Loss (gain) on sale of investment securities
Loss (gain) on valuation of investment securities
Loss (gain) on disposal of non-current assets
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Other, net
Subtotal
Subsidies received
Interest and dividends received
Interest paid
Income taxes refund
Income taxes paid
Net cash flows from operating activities

10

Six months ended
September 30, 2022

211,810
98,69762,37825,744△99,675△216,700
91,177
61,37819,711
2,198

74

－

△13,706

2,788

3,280

3,583

△2,645372△52,362△54,000△14△3,255
6,135
△52
3,133
△42,286－△29,198

8,480△40,051
29,756△34,114
27,21442
304,004
9,916△24,504△111,757
365,981
54,0002,459△2,411
71,062△363,205
127,887

9,346
－
－
－
541
436,927△99,703△643,591△247,727△607,913
42,286
3,263△1,913141,976△117,114△539,415

(Thousands of yen)Six months ended
September 30, 2021
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sale of property, plant and equipment
Purchase of software
Purchase of investment securities
Proceeds from sale of investment securities
Proceeds from distributions from investment
partnerships
Payments of leasehold deposits
Proceeds from refund of leasehold deposits
Payments for asset retirement obligations
Other, net
Net cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Purchase of treasury shares
Proceeds from disposal of treasury shares
Dividends paid
Other, net
Net cash flows from financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

11

Six months ended
September 30, 2022

△88,214141△69,291△10,000
40,307△267,663
2,019△49,344－
1,218

68,362－－
190,452△146,892△87,946△103,081△102
126,854－△44,732△231,752－－△129,350△578
36△64,111△78△194,081
14△169,261
12,946,994※ 12,777,733

50,0001,450,000△120,150△1,300,016
6△64,128－
15,711－△755,456
11,484,630※ 10,729,174

(4) Notes Concerning the Consolidated Financial Statements(Note Concerning the Premise of a Going Concern)
Not applicable(Note in the Case of Significant Changes in the Amount of Shareholders’ Equity)
Faith repurchased 1,800,000 shares of treasury stock based on a resolution of the Board of Directors
meeting held on May 17, 2022. Accordingly, the Company’s holdings of treasury stock increased by¥1,299,600 thousand during the first half of the current consolidated fiscal year. As a result of thisacquisition, the total amount of treasury stock was ¥2,422,337 at the end of the current second quarter.
(Changes in Accounting Policies)(Application of Implementation Guidance on Accounting Standard for Fair Value Measurement)
With effect from the beginning of the first quarter of the current consolidated fiscal year, Faith has begun
to apply the Implementation Guidance on Accounting Standard for Fair Value Measurement (ASBJ
Guidance No. 31, June 17, 2021, hereinafter the “Implementation Guidance”). In accordance with thischange, the Company has decided to apply the new accounting policies set forth in the Implementation
Guidance prospectively in accordance with the transitional treatment stipulated in Section 27-2 of the
Implementation Guidance. Application of the Implementation Guidance has no impact on the Company’s
consolidated financial results.
(Additional Information)(Application of Accounting Treatment and Disclosure When Adopting the Group Tax Sharing
System)With effect from the beginning of the first quarter of the current consolidated fiscal year, Faith and someof its domestic consolidated subsidiaries have transitioned from a non-consolidated taxation system to thegroup tax sharing system. In accordance with this change, the Company is applying the Practical Solution
on the Accounting and Disclosure under the Group Tax Sharing System (Practical Issues Task Force
Report No.42, August 12, 2021), which provides for the accounting treatment and disclosure of income
taxes, local income taxes, and tax-effect accounting.
(Segment Information)
Ⅰ 2nd quarter of the previous consolidated fiscal year/FY 2021 (April 1, 2021 through Sept. 30, 2021)

1. Information on sales and profit or loss by reportable segment(Unit: thousands of yen)

Adjustment
amount(Note 1)

Amount recorded in
Consolidated Financial
Statements (Note 2)

PlatformContent

Total

1,333,577

5,864,563

7,198,141－

7,198,141－

14,433

14,433－

14,433

1,333,577

5,878,997

7,212,575－

7,212,575

1,333,577

5,878,997

7,212,575－

7,212,575

156,942

13,099170,041△170,041－

1,490,520

5,892,096

7,382,616△170,041

7,212,575

66,881

185,831

252,713△155,985

96,728Net sales
Goods transferred at a single point in
time
Goods transferred over a period oftime
Revenue from contracts withcustomers
Sales to external customers
Intersegment sales or transfer amount

Total
Segment income or segment loss (△)

Notes: 1. The segment income or loss adjustment amount of △ ¥155,985 thousand consists of ¥715 thousand in eliminatedintersegment transactions and △¥156,700 thousand in companywide expenses not allocated to reportable segments.
2. Segment income amounts are adjusted with operating income in the quarterly consolidated profit and loss statement.

2. Information regarding impairment loss on fixed assets or goodwill by segment reported
This information is omitted since there is no critical impairment loss on fixed assets or significant
change in amount of goodwill.

12Ⅱ 2nd quarter of the current consolidated fiscal year/FY 2022 (April 1, 2022 through Sept. 30, 2022)

1. Information on sales and profit or loss by reportable segment(Unit: thousands of yen)

Adjustment
amount(Note 1)

Amount recorded in
Consolidated Financial
Statements (Note 2)

PlatformContent

Total

1,068,700

6,205,762

7,274,463－

7,274,463－

24,80224,802－24,802

1,068,700

6,230,564

7,299,265－

7,299,265

1,068,700

6,230,564

7,299,265－

7,299,265

185,476

16,854

202,331△202,331－

Total

1,254,177

6,247,419

7,501,596△202,331

7,299,265

Segment income or segment loss (△)△168,792

112,934△55,858△185,103△240,961

Net sales
Goods transferred at a single point in
time
Goods transferred over a period oftime
Revenue from contracts withcustomers
Sales to external customers
Intersegment sales or transfer amountNotes: 1. The segment income or loss adjustment amount of △ ¥185,103 thousand consists of ¥5,754 thousand in eliminatedintersegment transactions and △¥190,857 thousand in companywide expenses not allocated to reportable segments.
2. Segment income amounts are adjusted with operating income in the quarterly consolidated profit and loss statement.

2. Information regarding impairment loss on fixed assets or goodwill by segment reported
This information is omitted since there is no critical impairment loss on fixed assets or significant
change in amount of goodwill.
3. Matters related to changes in reportable segments, etc.
Historically, the Faith Group has had three reportable segments: the Content Business, the Point
Service Business, and the Label Business. However, after reassessing its business management
decision-making and performance classifications, with effect from the first quarter of the current
consolidated fiscal year, the Group has begun operate under two reportable segments: the Platform
Business and the Content Business. Moreover, since Faith Inc. now manages the entire Faith Group
following the integration of the Group’s offices, the personnel and other expenses of the Company's
Administration Department, which were previously included under the Content Business, are now
included in the adjustment amount as companywide expenses effective from the first quarter of thecurrent consolidated fiscal year.
In addition, segment information for the cumulative consolidated second quarter of the previous fiscal
year is disclosed based on the reporting segment classifications resulting from this change.

13