BRIEF STATEMENT OF CONSOLIDATED FINANCIAL RESULTS
FOR THE FULL FISCAL YEAR ENDED MARCH 2024
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.

May 14, 2024
Faith, Inc. (Stock code 4295, Listed on TSE 1st 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 General Meeting of Shareholders: June 21, 2024
Date of Submission of Annual Security Report: June 24, 2024
Starting Date of the Dividend Payment: June 5, 2024
Preparation of Supplementary Materials for Financial Results: Applicable/May 31, 2024
Information Meeting for Financial Results to be Held: Applicable/May 31, 2024 (for Institutional
Investors and Analysts)
Amounts are rounded down to the nearest JPY 1 million.

1. Results for the Fiscal Year Ending March 2024 (From April 1, 2023 to March 31, 2024)(1) Consolidated Operating Results(Percentages indicate changes compared with the previous fiscal year.)

Net SalesYear ending
March 2024
March 2023

Operating Income

Millions of yen%

13,73815,177△9.5△0.9

Millions of yen

Ordinary Income

%
—
—

△534
△183

Millions of yen

△564
△148

Net Income Attributable to
Shareholders of the Parent%——

Millions of yen%——△1,096△421(Note) Comprehensive income: fiscal year ending March 2024: △2,008 million (—%); fiscal year ending March 2023: △311 million (—%)

Year ending
March 2024
March 2023

Net Income per
Share

Diluted Net Income
per Share

Yen

Yen
—
—

△101.13△38.40Return on Equity
Capital
％
△7.7
△2.6

Ordinary Incomeon Total Assets
％
△2.4
△0.6

Operating Income on
Net Sales
％
△3.9
△1.2

(Reference) Equity in earnings of affiliates: fiscal year ending March 2024: ¥△154 million; fiscal year ending March 2023: ¥△35 million(2) Consolidated Financial Position
Total Assets

Year ending
March 2024
March 2023

Net Assets

Ratio of Equity Capital

Net Assets per Share

Millions of yen

Millions of yen%

Yen

21,903

13,27460.6

1,224.35

24,226

15,38563.5

1,420.51(Reference) Equity capital: fiscal year ending March 2024: ¥13,274 million; fiscal year ending March 2023: ¥15,385 million(3) Consolidated Cash Flow Results
Cash Flow fromOperating Activities

Year ending
March 2024
March 2023

Cash Flow from
Investing Activities

Cash Flow from
Financing Activities

Cash and Cash
Equivalents at Year End

Millions of yen

Millions of yen

Millions of yen

Millions of yen

△288
158

△324
△339

△602
△329

9,758
10,9731

2. Dividends
Dividends per ShareYear ending
March 2023
March 2024
March 2025
(Forecast)

1st
Quarter
Yen———

Interim
Yen

5.00
5.00
5.00

3rd
Quarter
Yen

Year-end
Yen

—
—
—

5.00
5.00
5.00

Total
(Annual)
Yen

Total Dividend
Payment

Payout Ratio(Consolidated)

Dividend on Net
Assets(Annual)(Consolidated)

Millions of yen

%

%

119
110

—
—

0.7
0.8

10,00
10.00
10.00

271.7

3. Forecast for the Consolidated Results for the Year Ending March 2025
（from April 1, 2024 to March 31, 2025）(Percentages show changes from the previous year for full-year figures and from the same quarter of the previous year for quarterly figures.)

Net Sales

Full
year

Operating Income

Net Income Attributable
to the Shareholders of
the Parent

Ordinary Income

Net Income
per Share

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

15,100

9.9

135

—

125

—

40

—

3.68

※ Notes(1) Changes in significant subsidiaries (accompanying changes in scope of consolidation): Applicable
Newly added subsidiaries: 0 companies (subsidiary’s name: None)
Removed subsidiaries: 1 company (subsidiary’s name: Faith Wonderworks, Inc.)(2) Changes in accounting policy, changes in accounting estimates, and restatements(2)-1. Changes accompanying revisions of accounting standards, etc.: None(2)-2. Changes other than the above: None(2)-3. Changes in accounting estimates: None(2)-4. Restatements: None

(3) Outstanding shares (common shares)(3)-1. Outstanding shares at the end of the fiscal years (including treasury stock):
The fiscal year ending March 2024: 13,831,091 shares
The fiscal year ending March 2023: 13,831,091 shares(3)-2. Treasury stock at the end of the fiscal year:
The fiscal year ending March 2024: 2,989,350 shares
The fiscal year ending March 2023: 2,999,883 shares(3)-3. Average number of shares during the accounting period
The fiscal year ending March 2024: 10,840,526 shares
The fiscal year ending March 2023: 10,981,526 shares(Note)The number of shares of treasury stock at the end of the fiscal year includes those shares (245,900 shares for the fiscal year ending
March 2024, 257,200 shares for the fiscal year ending March 2023) contributed as trust assets of the performance-linked stockcompensation plan. In addition, these shares are included in the shares of treasury stock deducted in calculating the average number ofshares during the accounting period (247,500 shares for the fiscal year ending March 2024, 257,200 shares for the fiscal year ending
March 2023).

2

(Reference) Overview of Non-Consolidated Results
Results for the Fiscal Year Ending March 2024 (From April 1, 2023 to March 31, 2024)(1) Non-Consolidated Operating Results(Percentages indicate changes compared with the previous fiscal year.)

Net SalesYear ending
March 2024
March 2023

Operating Income

Ordinary Income

Net Income

Millions of yen%

Millions of yen%

Millions of yen%

Millions of yen

%

1,946
1,835

6.0
△6.8

△804
△761

—
—

△676
△694

—
—

△211
△603

—
—

Net Income per ShareYear ending
March 2024
March 2023

Diluted Net Income per ShareYen△19.49△54.98Yen——(2) Non-Consolidated Financial Position
Total Assets

Year ending
March 2024
March 2023

Net Assets

Ratio of Equity Capital

Net Assets per Share

Millions of yen

Millions of yen%

Yen

17,18019,413

12,955
14,08775.4
72.6

1,194.94
1,300.67(Reference) Equity capital: fiscal year ending March 2024: 12,955 million; fiscal year ending March 2023: ¥14,087 million* 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 the Company’s control. For details of
cautions, etc., employed in making performance forecasts and the assumptions underlying performance forecasts, please refer to “1.
Overview of Operating Results, etc., (4) Future Outlook” on page 5 of the accompanying material.
(To obtain supplemental documents relating to financial results)
Supplemental Materials for Financial Results are posted on the company website on May 31, 2024.

3

Accompanying Material Contents
1. Overview of Operating Results, etc.……………………………………………………………………2(1) Overview of Operating Results for the Current Term…………………………………………… 2(2) Overview of Financial Position for the Current Term …………………………………………… 4(3) Overview of Cash Flow for the Current Term …………………………………………………… 4(4) Future Outlook…………………………………………………………………………………… 5(5) Basic Policy on Profit Allocation and Current Term/Next Term Dividend Distribution………… 5(6) Business Risks …………………………………………………………………………………… 5
2. Basic Philosophy on Selection of Accounting Standards………………………………………………7
3. Consolidated Financial Statements and Main Explanatory Notes.……………………………………. 8(1) Consolidated Balance Sheet…………………………………………………………………....…. 8(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income … 10
(Consolidated Statement of Income) …………………………………………………………… 10(Consolidated Statement of Comprehensive Income) ………………………………………… 11(3) Consolidated Statement of Changes in Shareholders’ Equity……………………………………12(4) Consolidated Statement of Cash Flows………………………………………………………… 14(5) Notes Concerning the Consolidated Financial Statements……………………………………… 16(Note Concerning the Premise of a Going Concern) …………………………………………… 16(Segment Information, etc.) …………………………………………………………………… 16(Per Share Information) ………………………………………………………………………… 19(Significant Subsequent Events) …………………………………………………………………19

1

1. Overview of Operating Results, etc.
(1) Overview of Operating Results for the Current Term
In the Japanese information and communications field in 2022, the Internet penetration rate remained high at
84.9%, while the percentage of households owning one or more smartphones increased to 90.1%, greatly
exceeding the 69.0% of households owning one or more personal computers (*1). In addition, while the movementaway from television has continued since the year 2000, mainly centered on the young, advertising expenses for
the Internet in Japan increased by 7.8% in 2023 from the previous year to ¥3,330.0 billion, exceeding the
combined advertising expenses for the four largest mass media sectors (newspapers, magazines, radio, andtelevision) of ¥2,316.1 billion, and accounting for 45.5% of Japan’s total advertising expenditures (*2). This trend
is also evident worldwide, where in 2024 global spending on digital advertising is expected to reachapproximately ¥65 trillion (US$442.6 billion), an increase of 6.5% from the previous year, with spending on
digital advertising exceeding 58.8% of total spending on advertising (*3).
*1. Source: Ministry of Internal Affairs and Communications, 2022 Telecommunications Usage Trend Survey Results*2. Source: Dentsu Inc., 2023 Advertising Expenditures in Japan*3. Source: Dentsu Group Inc., Global Ad Spend Forecasts (2023-2026)

In the entertainment market in 2023, sales in the global music market centered on streaming services grew by
10.2% year over year to approximately ¥4,318.6 billion (US$28.6 billion), expanding for the ninth consecutive
year and reaching its highest total since the beginning of this century. In particular, paid subscription streaming
accounted for 67.3% of the total, increasing to ¥2,914.3 billion ($19.3 billion) (*4). In Japan, the total production
value of the music software market including music videos increased by 10.0% year over year to ¥337.2 billion,
while paid music distribution sales increased by 11.0% to ¥116.5 billion and audio streaming sales increased by
14.0% year over year to ¥105.6 billion, accounting for more than 90% of total paid music distribution sales (*5).
In 2022, as the economy normalized through efforts to balance the spread of infection and economic activity, thelive entertainment market underwent a rapid recovery to reach ¥565.2 billion, which was 10.2% lower than thelevel in 2019, the year before the start of the novel coronavirus pandemic (the corresponding figure for 2021 was
51.2% lower than in 2019). The size of the market is expected to grow to ¥640.8 billion in 2023, and after that it
is forecast to expand at an annual growth rate of 0.9% and reach ¥652.5 billion in 2025 (*6).
*4. Source: IFPI, Global Music Report 2023
*5. Source: Recording Industry Association of Japan (RIAJ), The Recording Industry in Japan 2024
*6. Source: PIA Research Institute, Japanese Live Entertainment Market Survey Results and Latest Future Forecasts (published December 22,
2023)

Founded in 1992, Faith was the first company in the world to commercialize ringtones, and has steadily growncentered on the music distribution business and in step with the popularization of mobile phones. In the current
music market, along with the spread of smartphones and the diversification of media such as streaming, usergenerated content (UGC) (*7), which allows ordinary users to easily transmit information to society, and social
media, the music industry is facing a situation in which all of its activities, including content distribution methods,
consumption styles, and content production methods, are changing.
*7. User-generated content: images and videos generated and posted by users themselves on the Internet.

In this environment, the Faith Group is continuing to forge ahead with its Multi-Content and Multi-Device
Strategy of creating environments in which people can enjoy a wide variety of content when and where they want,by utilizing the efforts it has focused on digital content distribution ever since its establishment. In addition, theGroup is developing new services in response to the changing market environment, including platforms thatcollect and organize the information flooding the Internet and providing it to users after increasing its added value.
Our new platform sprayer® is an innovative music distribution service that allows artists to distribute andmonetize their own original songs worldwide simply by registering them, and also directly deliver music videos,
live performances, and other activities through the original spray LINK function. Spray LINK is equipped witha function that allows artists to recruit supporters (crowdfunding that allows them to return a portion of theirproceeds from music distribution to their fans as rewards), allowing them not only to raise funds for their activities,
but also to share profits with supporters so that their songs can reach as many listeners as possible. In December
2023, we began to support copyright management and distribution using text-to-speech characters not only inJapan but also internationally. For the future, we will continue to provide a platform that allows artists themselvesto directly deliver information about their works to listeners and fans, thereby helping to build deeper engagement
and facilitating monetization, and we will work to expand the artist economy at all levels and create a system that
“allows artists to grow together with their fans.”
The Faith Group reorganized its Content Business with effect from April 1, 2023, with the goal of establishing2

an organization that is better adapted to the needs of the present era. By breaking down the functions that eachgroup company has developed to date and clarifying their core competencies, we are aiming to create anorganizational structure that facilitates business development, differentiates the profit structure, and further
improves efficiency. Moreover, by building a system capable of promptly responding to the rapidly changing
tastes and trends in the music market, we are enhancing our ability to create appealing content and improving ourcompetitiveness. By consolidating our major labels, further strengthening and increasing the efficiency of ouradministrative and sales functions, and integrating the assets belonging to each label using the Group's own
technology, we are aiming to achieve even greater Group synergies. We also intend to continue to pursue more
flexible ways of working in line with changes in consumer behavior and the establishment of new values.
In addition, Faith, which had been listed on the Prime Market of the Tokyo Stock Exchange, transferred to theStandard Market of the Tokyo Stock Exchange as of October 20, 2023, following its application for selection forlisting on the Standard Market subsequent to the revision of the Tokyo Stock Exchange rules, which came into
effect on April 1, 2023. Looking ahead, we will continue to pursue flexible organizational management, centralize
our business strategies, speed up decision-making, and effectively utilize our resources including knowhow andhuman resources to further strengthen the Faith Group’s creative capabilities so that we can respond appropriately
to changes in the music industry and enhance the corporate value of the entire Group.
Amid the rapid decline in sales of packaged goods in the domestic music market since 2018, the Faith Group has
worked to minimize the impact of the market contraction on its business by utilizing its catalog sound source
assets. However, in recent years, the share of the total sales of the Content Business accounted for by packaged
products has continued to decline, and the business environment that surrounds the Company remains challenging.
In order to reestablish a structure that can adapt to the current period of change in the music industry, the Company
has decided to undertake organizational reforms by implementing transitional support measures, as wasannounced on March 26, 2024. In addition to promoting further selection and concentration in our existing
businesses, we will steadily promote fundamental organizational reforms with a view to realizing sustainablegrowth and increasing our corporate value over the medium to long term.
Regarding the Faith Group’s business performance for the consolidated fiscal year ending March 31, 2024, net
sales decreased by 9.5% from the previous fiscal year to ¥13,738 million, the operating loss amounted to ¥534
million (compared with an operating loss of ¥183 million for the previous fiscal year), and the ordinary loss
amounted to ¥564 million (compared with an ordinary loss of ¥148 million for the previous fiscal year). The net
loss attributable to shareholders of the parent amounted to ¥1,096 million (compared with a net loss attributable
to shareholders of the parent of ¥421 million for the previous fiscal year). Major factors in the net loss included
impairment losses of ¥106 million associated with system development in the Content Business, businessstructure improvement expenses of ¥68 million, and an income tax adjustment of ¥367 million due to the reversalof deferred tax assets in consideration of the possibility of future recoveries.
Information on each business segment is as follows.
Platform BusinessIn the Platform Business, as sales in our existing distribution businesses continue to decline, we will make further
investments in new growth areas by linking and platforming each of our services with the aim of developing
innovative products and capturing diversified revenue-generating 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 will continue to aim at thecreation and activation of a new BGM market. In Fans’, our platform for artists, we are enhancing the functions
essential to artists’ musical activities such as constructing official websites, distributing music and videos, selling
artists’ goods, and operating fan clubs. By strengthening links with SNS, this service can contribute to building acommunity by sharing the information that creators send out.
The point service provides a platform for retailers to operate point systems and offers total support from planningto operation as a series of cycles for acquiring, analyzing, and utilizing point issuance data for sales promotionuse, as well as outsourcing services to maximize the efficiency of retail sales promotions. Moreover, in line withthe recovery of the real-live market, our live-streaming platform Thumva ceased providing services at the end of
November 2023, after fulfilling its original purpose of “delivering exciting live experiences online” under the
restrictions on activity imposed due to the spread of infectious disease. Meanwhile, the business transfer ofThumva BIZ, our new service for stores that utilizes Thumva’s resources, was completed on December 1, 2023.

3

Regarding the performance of this segment for the current consolidated fiscal year, artist-oriented platform sales
increased, and sales of official carrier website services for mobile phone content distribution remained at the samelevel as the previous year, while points issuance to existing member stores on the retailer point system operation
platform decreased. In addition, due to the termination of the aforementioned Thumva platform, net sales
decreased by 9.0% year over year to ¥1,955 million, and this segment recorded a loss of ¥216 million (comparedwith a segment loss of ¥236 million for the previous fiscal year).
Content BusinessIn the Content Business, we are strengthening new businesses with an eye to the future in order to overcome ourdependence on sales of packaged products in the severe environment faced by the music and video-relatedindustries due to the changing music market. In an effort to create new hits, the three label companies, Nippon
Columbia, DREAMUSIC, and KSR, are developing and nurturing content suitable for the next-generation musicbusiness. In addition, they are actively utilizing their extensive catalog assets in new projects, with the goal of
expanding their IP domains both in Japan and globally.
Regarding the performance of this segment, although major live events by the company’s artists were held during
the period and sales of high-margin sound sources increased, due to cancelations and postponements of new
releases and a decline in sales of major packaged goods, net sales decreased by 9.6% year over year to ¥11,782
million and segment income decreased by 70.9% year over year to ¥125 million.
*Product and service names appearing in this document are trademarks or registered trademarks of Faith, Inc. either in Japan or in other countries.

(2) Overview of Financial Position for the Current Term
Total assets as of the end of the consolidated fiscal year ended March 31, 2024 decreased by ¥2,323 million year
over year to ¥21,903 million, a decrease of 9.6% from the end of the previous fiscal year. This result was mainly
attributable to a decrease in cash and deposits, an increase in accounts receivable-trade, and a decrease ininvestments and other assets.
Total liabilities decreased by ¥211 million year over year to ¥8,629 million, a decrease of 2.4% compared withthe end of the previous fiscal year. This was mainly attributable to an increase in notes and accounts payabletrade and a decrease in repayment of long-term loans payable.
Net assets decreased by ¥2,111 million year over year to ¥13,274 million, a decrease of 13.7% compared with theend of the previous fiscal year. This was mainly the result of a net loss attributable to shareholders of the parent
and a decrease in the valuation difference on other marketable securities. The equity ratio was 60.6%.

(3) Overview of Cash Flow for the Current Term
Cash and cash equivalents at the end of the consolidated fiscal year ended March 31, 2024 decreased by ¥1,215
million year over year to ¥9,758 million, a decrease of 1.11% compared with the end of the previous fiscal year.
Details of cash flow during the fiscal year under review and its main contributory factors were as follows:(Cash flow from operating activities)
Net cash flow from operating activities amounted to an outflow of ¥288 million (compared with an inflow of¥158 million for the previous fiscal year), attributable mainly to a loss before income taxes and minority interestsof ¥664 million, and to expenditures of ¥186 million in respect of depreciation expenses, ¥120 million in respectof amortization of goodwill, as well as to income tax refunds of ¥190 million and income tax payments of ¥24
million, etc.
(Cash flow from investing activities)
Net cash flow from investing activities amounted to an outflow of ¥324 million (compared with an outflow of¥339 million for the previous fiscal year), attributable mainly to expenditures of ¥79 million in respect of theacquisition of tangible non-current assets, ¥70 million in respect of the acquisition of software, and ¥276 in respectof expenditure for loans receivable.
(Cash flow from financing activities)
Net cash flow from financing activities amounted to an outflow of ¥602 million (compared with an outflow of¥329 million for the previous fiscal year), mainly due to expenditures of ¥495 million in respect of repayment oflong-term borrowing and ¥110 million in respect of dividend payments.

4(4) Future Outlook
The Faith Group’s business performance forecasts for next consolidated fiscal year (FY 2024; ending March 31,2025) are for net sales of ¥15,100 million, operating income of ¥135 million, ordinary income of ¥125 million,
and net income attributable to the shareholders of the parent of ¥40 million.
With the aim of creating “future entertainment”, the Faith Group will respond quickly and flexibly to changes inthe business environment.

(5) Basic Policy on Profit Allocation and Current Term/Next Term Dividend Distribution
Faith Inc. will continue its policy of placing priority on strengthening its corporate structure and securing thefunds necessary for making aggressive business investments. At the same time, the Company also recognizes thatthe return of profits to shareholders is an important management task. For this reason, the Company will consider
the payment of dividends while taking into account its operating results and financial position.
As initially announced, the Company is planning to pay a dividend of ¥10 per share for the current fiscal year(including an interim dividend of ¥5 that has already been paid), based on the decision of the Board of Directors
to continue to make flexible payments to shareholders regardless of the timing of the Annual General Meeting of
Shareholders. For the next fiscal year, based on its fundamental policy of paying continuous stable dividends, theCompany is also planning to pay a dividend of ¥10 per share (including an interim dividend of ¥5).

(6) Business Risks
1) Risks related to business content
Platform Business(a) Business environment
The Faith Group develops new markets by creating services that users want to use based on original businesssolution proposals and develops content services and wide-ranging enterprise support services through tie-ups
with leading companies in various fields such as content providers. Competition is intense in the Platform
Business that the Group and its collaborating content providers are striving to develop, and it is possible that the
number of new entrants in this business will continue to increase in future. If unit prices of content decrease due
to price competition, etc., if the content services of the Group and its collaborating content providers fail to meetthe needs of users, or if the number of users decreases, then there is a possibility that sales will not expand.
In some cases, the Group may provide server construction and operation services in order to meet the needs ofcontent provider customers. In so doing, the Group makes every effort to prevent operational management failures,and even in the unlikely event of such a failure occurring, we take emergency measures and have a system inplace that allows us to restore operation quickly by remote control. However, in the case that unavoidable failuresoccur due to natural disasters, etc., that would make it difficult to provide services for an extended period, thismay adversely affect the Group’s performance.
(b) Quality control
The Faith Group makes every effort to ensure quality control by operating a thorough system supported bytechnological development. However, even after the customer company's acceptance inspection, if deficiencies,
discrepancies or defects are found in the Group's technology, in the case that a user suffers a loss as a consequenceof using a product or service that employs the Group’s technology, this may adversely affect the Group’s current
or future business performance.
(c) Legal regulations
Increasing damage caused by illegal acquisition and modification of data on the Internet or by leakage of personal
information has led to the development of legal regulations in Japan and elsewhere. The Faith Group’s operations
are related to the business of distributing content via the Internet, so in the case that laws and regulations or
voluntary restraints between businesses are established in this field, or if the application of laws and regulations
becomes clear, there is a possibility that the Group’s business development will be restricted and that costs may
be incurred with regard to the implementation of countermeasures.
(d) Point service
The Faith Group sells points to participating point member stores, and in order to prepare for the cost burden ofusing points, with regard to the balance of unexchanged points among issued points, the required amount that is5

expected to be used in future is estimated and recorded as a provision based on the past point collection rate.
However, if points are exchanged in excess of the estimated amount, this may adversely affect the Group’sbusiness performance.
Contents Business(a) Economic situation and market environment
The Faith Group's main businesses, including the sale and distribution of music and video titles such as CDs andDVDs, and the Sales/Digital Distribution Business, are affected by the economic conditions in the regions andcountries where these products are sold. Many of the Group's products are not necessarily indispensable for
consumers, and their sales are strongly influenced by market trends, consumer preferences and consumption
behavior. For this reason, if the demand for the products of the music and video-related industry in generaldeclines due to a recession or reduced consumer spending, the Group's business performance and financial
condition may be adversely affected. An increase in illegal copying and downloading is considered to be one of
the factors causing the current decline in sales of music and video-related titles and the contraction in the overall
scale of the music and video-related industry. Competition in the music and video-related industry is intensifying
in this shrinking market, and this has a significant effect on the Group's sales and profitability. Digital music
distribution has become popular in recent years, and the Group is focusing its efforts on this field as well. However,
the expansion of this market may have a negative impact on sales of the Group’s conventional products such asmusic CDs. Due to the recent revision of the Japanese Copyright Act, downloading of illegal copies is now
prohibited, and consequently it is expected that the number of illegal downloads will decrease, but illegal
downloads from illegal distribution sites still appear to be at a high level, which is likely to adversely affect theGroup’s sales. Moreover, in the music market, price competition is intensifying, as can be seen in the release of
low-priced CDs, which may adversely affect the Group’s business performance and financial condition.
(b) Music works and artists
Most of the revenue generated by the Faith Group’s business depends on the creation of hits by popular artists,
and the stability and growth of the Group’s management derives from the creation of artists and music works thatare expected to become hits. The Group will continue to discover and develop new artists who will be acceptedby consumers, but since the creation of hit titles involves complex and uncertain factors such as consumer
preferences and trends, lack of success at producing hits may adversely affect the Group’s business performanceand financial condition.
(c) Performance plan
The Faith Group's sales and profitability rest on a low proportion of fixed and continuous income, and are strongly
influenced by the sales situation of individual music titles. Since the sales situation changes due to a number offactors such as the trends of the times and consumer preferences, sales may fall below the forecast levels predictedfrom past results so that the targets specified in the initial performance plan may not be achieved. In addition, theproduction of music CDs and other products may be postponed or canceled due to factors involving artists,
production, and manufacturing and sales outsourcing, which may cause the Group’s performance to fall below
the level specified in the initial performance plan. For this reason, it is difficult to predict business performanceelements such as sales forecasts, and a decline in profit for a specific quarter may change the business performanceplan and affect the business performance. In the manufacturing and sales contract business, depending on thecircumstances of individual business partners, the subcontractor may be changed from the Group to anothersubcontractor, which may be a factor in driving the Group’s actual business performance below level specified
in the initial performance plan.
(d) Retail price maintenance system and return prevention measures
Under the Antimonopoly Act, copyrighted works such as music CDs, newspapers, books, etc. may be legallyresold under a resale price maintenance system (resale system). Although there is no guarantee that the system
will last forever, the Japan Fair Trade Commission has announced its view that it is reasonable to leave the system
in place for the foreseeable future. Moreover, in recent years, the copyright law has been revised to protect theinterests of copyright holders of music CDs produced locally under license agreements for the purpose of sellingthem in Asia at low cost. A so-called return prevention measure has been introduced to prohibit the import ofcommercial records produced for the purpose of distribution overseas under certain conditions. If in the future,
the Antitrust Law or Copyright Act is reviewed, there is a possibility that the Faith Group’s sales may be reduced.
(e) Returns
Due to the resale system for products such as music CDs, retailers cannot set the selling price freely. Instead,
there is a business practice under which retailers can return products within a certain range. For this reason, some6

products that do not sell well may be returned in the future. The Faith group properly prepares for this eventuality
by recording contract liabilities based on past returns and other provisions. However, if more returns occur due
to unexpectedly poor sales, etc., there is a possibility that the Group’s business performance may be adversely
affected through decreases in sales and profit.
2) Intellectual property rights
The Faith Group has filed patent applications and trademark applications related to its technology, and the Groupintends to continue making similar promotion efforts in future. With respect to intellectual property rights suchas patent rights, trademark rights, and copyrights, the Group is strengthening its efforts to protect these rights andto prevent infringements. However, it is difficult to predict how the intellectual property rights of third parties
will be applied to the Group’s business. For example, in the future, if a patent right related to the Group’s businessmodel or to a related technology is established by a third party, or if a patent right not recognized by the Group isestablished, there is a possibility that the Group may be required to compensate the patent holder for damages
related to an infringement of the said patent right, or it may become impossible for the Group to continue to
conduct all or part of the business related to the patent. In addition, even if the patent holder allows the use tocontinue, payment of a license fee may be obligated, and in such a case, this may adversely affect the Group’s
performance.
Among the intellectual property rights owned by the Group, rights such as copyrights and neighboring rights
represent one of the strengths of the Group’s business. However, there is a possibility that third parties may
infringe on the rights regarding songs sold by the Group or for which the Group holds rights or that the Groupmay unintentionally infringe the rights of third parties. Such copyright infringements may adversely affect theGroup’s business performance and financial condition.
3) Leakage of personal information
Regarding the protection of personal information, the Faith Group has established a personal information
protection policy for the purpose of completing the internal system and instilling an awareness of complianceamong its employees, as well as exercising the utmost caution in conducting internal education and implementing
security measures for information systems. However, if personal information is leaked for some reason, it may
damage the Group’s social credibility and adversely affect its business performance and financial condition.
4) Disposal of businesses
The Group conducts business reviews as appropriate, which may result in losses if it decides to sell or dispose of
related assets. On the other hand, the Group actively considers business tie-ups with other companies, and there
is a possibility that such business tie-ups may adversely affect the Group’s business performance and financial
condition.
5) Pension system
The Group has established a defined-benefit corporate pension plan for beneficiaries and a pension plan for
employees that combines a lump-sum retirement allowance plan with a defined contribution pension plan.
However, if in the future pension asset management yields decline, or if the actuarial assumptions or theassumptions used to calculate retirement benefit obligations are changed, retirement benefit obligations andretirement benefit expenses may increase, which could adversely affect the Group’s business performance andfinancial condition.
6) Large-scale natural disasters and pandemics
In the event of a natural disaster such as a large-scale earthquake, severe storm or flood, or a pandemic such as
the novel coronavirus infection, the Group's business performance could be affected by such factors as voluntary
restraints on business activities and the prolonged closure of store facilities. In addition, if the Group's head office,business offices, store facilities, artists, production companies, contract manufacturers, or sales consignees
experience a disruption of their business activities due to the aforementioned natural disasters or pandemics, there
is a possibility that this could hinder the Group’s business activities and adversely affect its business performanceand financial condition.

2. Basic Philosophy on Selection of Accounting Standards
For the present, the Faith Group is following a policy of producing its consolidated financial statements underJapanese standards in the interest of maintaining comparability between the financial statements of its constituent
companies. Furthermore, concerning the future application of the International Financial Reporting Standards(IFRS), we intend to respond appropriately based on the movements of other companies, etc.

7

3. Consolidated Financial Statements and Main Explanatory Notes(1) Consolidated Balance Sheet(Thousands of yen)

FY 2022(As of March 31, 2023)
AssetsCurrent assets
Cash and deposits
Notes receivable
Accounts receivable
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
Buildings and structures
Accumulated depreciation
Buildings and structures (net base)Machinery and delivery equipment
Accumulated depreciation
Machinery and delivery equipment (net base)Tools, devices and equipment
Accumulated depreciation
Tools, devices and equipment (net base)
Boats and ships
Accumulated depreciation
Boats and ships (net base)Land
Construction in progress
Total tangible non-current assets
Intangible assets
Software
Goodwill
Other
Total intangible non-current assets
Investment and other assets
Investment securities
Deferred tax assets
Other
Allowance for doubtful accounts
Total investment and other assets
Total non-current assets
Total assets

8

FY 2023(As of March 31, 2024)

11,024,018
6,873
1,992,323
920
218,509290,769
373,434
62,796
175,393
796,954△23,801
14,918,191

9,808,298
5,831
2,360,257
120
214,953
287,356
562,51944,505405
1,178,706△20,364
14,442,592

2,349,898△753,527
1,596,370
618,462△583,498
34,964815,982△701,522
114,460
2,894
△482
2,412
1,558,120
275,2123,581,540

2,636,521△826,293
1,810,228
619,341△587,721
31,620829,607△736,582
93,024
2,894△1,6881,206
1,558,120－
3,494,199

100,278
1,149,180
258,789
1,508,248

133,404
1,028,423
129,649
1,291,477

3,621,214
210,402
1,064,557△677,703
4,218,470
9,308,259
24,226,451

2,168,088
70,091
546,213△109,238
2,675,154
7,460,831
21,903,424

(Thousands of yen)

FY 2022(As of March 31, 2023)
Liabilities
Current liabilities
Notes and accounts payable- trade
Short-term loans payable
Current portion of long-term debt
Accounts payable-otherAccrued expenses payable
Income taxes payable
Provision for bonuses
Contract liabilities
Provision for business structure improvement
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Retirement benefit liabilities
Provision for share awards for directors (and otherofficers)
Asset retirement obligations
Deferred tax liabilities
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on other marketable securities
Foreign currency translation adjustment
Accumulated retirement benefit adjustment
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

9

FY 2023(As of March 31, 2024)

765,755
390,000
495,350
906,621
3,141,533
27,201
295,468
48,216－
742,554
6,812,700

1,107,266
385,002433,200
801,7623,008,212
83,716
274,752
32,651
68,162
1,087,841
7,282,567

924,800
504,822491,600
450,133

47,15837,47939,333
482,410
29,3352,027,860
8,840,561

39,383324,855
3,271
1,346,723
8,629,291

3,218,000
2,840,496
9,851,724△2,422,510
13,487,710

3,218,000
2,840,416
8,644,481△2,414,684
12,288,213

1,848,510△8,87958,547
1,898,179－
15,385,889
24,226,451

959,469△8,87735,327985,919－
13,274,133
21,903,424

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income(Consolidated Statement of Income)(Thousands of yen)

FY 2022(April 1, 2022 ~March 31, 2023)
Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating income (loss =△)Non-operating income
Interest income
Dividend income
Interest on securities
Foreign exchange gains
Gain on investments in investment partnerships
Subsidy income
Gain on liquidation of unpaid royalties
Gain on reversal of provision for directors' share benefits
Miscellaneous receipts
Total non-operating Income
Non-operating expenses
Interest paid
Foreign exchange loss
Share of loss of entities accounted for using equity method
Loss on valuation of securities
Loss on investments in investment partnerships
Settlement payment
Miscellaneous expenses
Total non-operating expenses
Ordinary income (loss =△)Extraordinary income
Gain on sale of non-current assets
Gain on sale of investment securities
Gain on transfer of business
Compensation income
Total extraordinary income
Extraordinary losses
Loss on disposal of non-current assets
Loss on valuation of investment securities
Impairment loss
Business structure improvement expenses
Total extraordinary losses
Net income (loss =△) before income taxes
Corporate, inhabitant, and enterprise taxes
Corporate tax adjustment
Total income taxes
Net income (loss = △)Net income (loss = △) attributable to noncontrolling interests
Net income (loss = △) attributable to shareholders of parent

10

FY 2023(April 1, 2023 ~March 31, 2024)

15,177,877
9,382,883
5,794,994
5,978,124△183,130

13,738,355
8,547,751
5,190,603
5,725,161△534,557

104
4,440
232
－
2,481
55,438－－39,675102,372

163
6,628
534
1,003
6,355
11,190110,815
6,853
28,454
172,000

8,470
622
35,416
6,439
9,922
－
6,546
67,417△148,174

8,428－
154,183
5,312
6,731
11,15516,300202,112△564,669

4,832
－
－
－
4,832

2,327
1,372
26,00070,01599,71418,807－
13,170－31,977△175,319
81,746
164,711
246,457△421,777－△421,777

15
25,040106,576
68,162
199,794△664,749
64,534
367,076431,610△1,096,360－△1,096,360

(Consolidated Statement of Comprehensive Income)(Thousands of yen)

FY 2022(April 1, 2022 ~March 31, 2023)
Profit (loss = △)Other comprehensive income
Valuation difference on other marketable securities
Foreign currency translation adjustment
Retirement benefit adjustment (before any applicable tax
effect)Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to shareholders of parent
Comprehensive income attributable to non-controllinginterests

11

FY 2023(April 1, 2023 ~March 31, 2024)△421,777△1,096,360

107,795
2△889,0412

2,204△23,219

110,001△311,775△912,259△2,008,620△311,775△2,008,620－－

(3) Consolidated Statement of Changes in Shareholders’ Equity
Previous consolidated fiscal year/FY 2022 (April 1, 2022 ~ March 31, 2023)(Thousands of yen)

Shareholders' equity
Capital stock Capital surplus
Balance at beginning of period

3,218,000

2,840,498

Retainedearnings

Treasury stock

Total shareholders’equity10,393,392△1,122,330

15,329,560

Changes of items during period
Dividend of surplus△119,890△119,890

Net gain or net loss (△) attributable
to shareholders of parent△421,777△421,777

Acquisition of treasury stock△1,300,188△1,300,188

9

6

△2

Disposal of treasury stock
Changes in non-equity items during
period (net amount)
Total changes during period
Balance at end of period

－
－

△2

△541,667△1,300,179△1,841,849

3,218,000

2,840,496

9,851,724△2,422,510

13,487,710

Accumulated other comprehensive income
Valuation
Foreigndifference
currency
on othertranslation
marketableadjustments
securities
Balance at beginning of period

1,740,714△8,881Retirement
benefitrelated
adjustments

Total otheraccumulatedcomprehensive income

Minority
Interests

Total net
assets56,343

1,788,177－

17,117,737

Changes of items during period
Dividend of surplus△119,890

Net gain or net loss (△) attributable
to shareholders of parent△421,777△1,300,188

Acquisition of treasury stock

6

Disposal of treasury stock
Changes in non-equity items during
period (net amount)

107,795

2

2,204

110,001

110,001

Total changes during period

107,795

2

2,204

110,001－ △1,731,847

Balance at end of period

1,848,510△8,87958,547

1,898,179

12－

15,385,889

Current consolidated fiscal year/FY 2023 (April 1, 2023 ~ March 31, 2024)(Thousands of yen)

Shareholders' equity
Capital stock Capital surplus
Balance at beginning of period

3,218,000

2,840,496

Retainedearnings
9,851,724

Treasury stock

Total shareholders’equity△2,422,510

13,487,710

Changes of items during period
Dividend of surplus
Net gain or net loss (△) attributable
to shareholders of parent△110,882△110,882△1,096,360△1,096,360

Acquisition of treasury stock
Disposal of treasury stock

△79

△485

△485

8,311

8,231

Changes in non-equity items during
period (net amount)
Total changes during period
Balance at end of period

－
－

△79

△1,207,243

7,825△1,199,497

3,218,000

2,840,416

8,644,481△2,414,684

12,288,213

Accumulated other comprehensive income
Valuation
Foreigndifference
currency
on othertranslation
marketableadjustments
securities
Balance at beginning of period

1,848,510△8,879Retirement
benefitrelated
adjustments

Total otheraccumulatedcomprehensive income

Minority
Interests

Total net
assets58,547

1,898,179－

15,385,889

Changes of items during period△110,882

Dividend of surplus
Net gain or net loss (△) attributable
to shareholders of parent△1,096,360

Acquisition of treasury stock△485

Disposal of treasury stock

8,231

Changes in non-equity items during
period (net amount)△889,0412△23,219△912,259△912,259

Total changes during period△889,0412△23,219△912,259－ △2,111,756

Balance at end of period

959,469△8,87735,327985,919

13－

13,274,133

(4) Consolidated Statement of Cash Flows(Thousands of yen)

FY 2022(April 1, 2022 ~March 31, 2023)
Cash flow from operating activities
Income or loss (△) before income taxes, etc.
Depreciation expenses
Impairment losses
Amortization of goodwill
Business structure improvement expenses
Increase/decrease in allowance for doubtful accounts (△ = decrease)
Increase/decrease in reserve for bonuses (△ = decrease)
Increase/decrease in net defined retirement liabilities (△ = decrease)
Increase/decrease in for stock benefits for directors (△ = decrease)
Interest and dividend income
Interest on marketable securities
Gain or loss on valuation of marketable securities (△ = gain)
Interest paid
Subsidy income
Gain or loss on transfer of business (△ = gain)
Compensation income
Gain or loss on equity method investment (△ = gain)
Gain or loss on investment partnership management (△ = gain)
Gain or loss on valuation of investment securities (△ = gain)
Gain or loss on disposal of non-current assets (△ = gain)
Increase/decrease in trade receivables (△ = increase)
Increase/decrease in inventory assets (△ = increase)
Increase/decrease in trade payables (△ = decrease)
Increase/decrease in consumption tax receivable (△ = increase)
Increase/decrease in consumption tax payable (△ = decrease)
Other
Sub-total
Amount of subsidy income received
Amount of interest and dividends received
Amount of interest paid
Amount of compensation income received
Amount of income tax refundedAmount of income tax paid
Net cash flow from operating activities

14△175,319
186,636
13,170121,757－
47,83257,206△37,7227,466△4,544
△232
6,439
8,470
△55,438－－
35,416
7,441－
18,80752,582
212,214△635,309
69,431
22,867
371,456
330,630
55,438
4,776△7,525－
138,186△363,105
158,400

FY 2023(April 1, 2023 ~March 31, 2024)△664,749
186,242
106,576
120,757
68,162△3,314△20,715△54,688△9,679△6,792
△534
5,312
8,428
△11,190△26,000△70,015
154,183376
23,66815△411,898△166,580
341,511△108,499
63,222△57,370△533,572
11,1907,326△8,72270,015
190,240△24,632△288,155

(Thousands of yen)

FY 2022(April 1, 2022 ~March 31, 2023)
Cash flow from investing activities
Expenditure for acquisition of tangible non-current assets
Income from sale of tangible non-current assets
Expenditure for acquisition of software
Expenditure for acquisition of investment securities
Income from sale of investment securities
Income from share of profits from investment partnerships
Expenditure for loans
Income from collection of loans receivable
Expenditure for security deposits
Income from collection of security deposits
Expenditure for fulfillment of asset retirement obligations
Income from transfer of business
Other
Net cash flow from investing activities
Cash flow from financing activities
Net increase/decrease in short-term borrowing (△ = decrease)
Expenditure for repayment of long-term borrowing
Income from long-term borrowing
Expenditure for acquisition of treasury stock
Income from disposal of treasury stock
Payment of dividends
Net cash flow from financing activities
Effect of exchange rate on cash and cash equivalents
Net increase/decrease in cash and cash equivalents (△ = decrease)
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year

15

FY 2023(April 1, 2023 ~March 31, 2024)△304,144
4,832△76,824△5,000
1,218
－
－
180
△162
131,59750－△91,648△339,902△79,124
2,327△70,992△25,000
1,400
902△276,200
736
△40
－
－
26,00095,229△324,761

50,000△409,700
1,450,000△1,300,188
6△119,249△329,131－△510,633
11,484,630
10,973,997△4,998△495,350
－
△485
8,231
△110,203△602,805
2△1,215,720
10,973,997
9,758,276

(5) Notes Concerning the Consolidated Financial Statements(Note Concerning the Premise of a Going Concern)
Not applicable(Segment Information)
1. Outline of reportable segments
The Company’s reportable segments provide financial information separated according to its
various structural units and are also subject to periodic review when the Board of Directors decides
on the allocation of management resources and makes performance appraisals. The Faith Group’s
main businesses are the Platform Business the Content Business.
Platform BusinessIn order to promote its Multi-Content and Multi-Platform Strategy, the Faith Group’s Platform
Business provides one-stop solutions ranging from content creation and production, todevelopment and provision of distribution platform technology, construction and operation of
network systems for content distribution, and content distribution services for users. Thisbusiness also provides point services to retailers and other services. Main companies involved inthis business: Faith, Inc. and GoodyPoint Co., Ltd.
Content Business
The Content Business encompasses the planning, production and sales of sound sources and videos,
as well as the music copyright acquisition and management business, the manufacturing and salesconsignment business, and the facility and event consignment business. Main companies involvedin this business: Nippon Columbia Co., Ltd., DREAMUSIC Inc., and KSR Corp.
2. Calculation method for sales, profit or loss, assets, liabilities and other items by reportable segment
The accounting method for the reportable business segments is in accordance with the accounting
policies adopted for preparing the consolidated financial statements.
For the profit figures of the reportable segments, the operating income base figures are used. Intersegment sales and transfer amounts are decided in consideration of the market price and otherfactors.

16

3.

Information on sales, profit or loss, assets, liabilities and other items by reportable segment
Previous consolidated fiscal year/FY 2022 (April 1, 2022 ~ March 31, 2023)(Thousands of yen)

PlatformContent

Total

Revenue from contracts with customers

2,150,231－
2,150,231

12,840,225
187,420
13,027,646

14,990,457
187,420
15,177,877

Sales to external customers

2,150,231

13,027,646

385,156

64,857

Total

2,535,388

Segment income or segment loss (△)
Segment assets

Adjustment
Amount recorded inamount (Notes Consolidated Financial
1, 2, 4 & 5)
Statements (Note 3)

Net sales
Goods transferred at a single point in time
Goods transferred over a period of time

Intersegment sales or transfer amount

Other items
Depreciation expenses
Amortization of goodwill
Investment in equity-method affiliates－－－

14,990,457
187,420
15,177,877

15,177,877－

15,177,877

450,014△450,014－

13,092,503

15,627,892△450,014

15,177,877△236,860

433,171

196,311△379,441△183,130

14,165,422

14,204,306

28,369,729△4,143,277

24,226,451

116,082

70,553

186,636－

186,636

1,000

120,757

121,757－

121,757

224,627

116,374

341,001△35,225

305,775

Increase in tangible and intangible non－
328,170
52,798
380,968
current assets(Notes)1. The segment income or segment loss adjustment amount of △¥379,441 thousand for the current fiscal year is due to theelimination of intersegment transactions of △¥11,429 thousand and corporate expenses of ¥390,870 thousand that are notallocated to reportable segments.
2. The segment assets adjustment amount eliminates intersegment transactions, etc.
3. The segment income or segment loss is adjusted with the operating loss in the consolidated financial statements.
4. The amortization of goodwill adjustment amount of represents the elimination of intersegment transactions.
5. The investment in equity-method affiliates adjustment amount represents the elimination of intersegment transactions.

380,968

Current consolidated fiscal year/FY 2023 (April 1 2023 ~ March 31, 2024)(Thousands of yen)

Adjustment
Amount recorded inamount (Notes Consolidated Financial
1, 2, 4 & 5)
Statements (Note 3)

PlatformContent

Total

Revenue from contracts with customers

1,955,852－
1,955,852

11,519,274
263,228
11,782,502

13,475,126
263,228
13,738,355－－－

13,475,126
263,228
13,738,355

Sales to external customers

1,955,852

11,782,502

13,738,355－

13,738,355

503,394

96,335599,730△599,730－

Total

2,459,246

11,878,838

14,338,085△599,730

13,738,355

Segment income or segment loss (△)△216,123

125,952△90,170△444,387△534,557

Segment assets

11,755,394

14,038,520

25,793,915△3,888,277

21,905,638

134,917

51,324

186,242－

186,242－

120,757

120,757－

120,757

170,567

94,149264,716△113,124

151,591

Net sales
Goods transferred at a single point in time
Goods transferred over a period of time

Intersegment sales or transfer amount

Other items
Depreciation expenses
Amortization of goodwill
Investment in equity-method affiliates

Increase in tangible and intangible non－
90,481
59,635150,116
current assets(Notes)1. The segment income or segment loss adjustment amount of △¥444,387 thousand for the current fiscal year is due to theelimination of intersegment transactions of △¥2,967 thousand and corporate expenses of ¥447,354 thousand that are notallocated to reportable segments.
2. The segment assets adjustment amount eliminates intersegment transactions, etc.
3. The segment income or segment loss is adjusted with the operating loss in the consolidated financial statements.
4. The amortization of goodwill adjustment amount of represents the elimination of intersegment transactions.
5. The investment in equity-method affiliates adjustment amount represents the elimination of intersegment transactions.

17

150,116

[Related Information]
Previous consolidated fiscal year/FY 2022 (April 1, 2022 ~ March 31, 2023) and current
consolidated fiscal year/FY 2023 (April 1 2023 ~ March 31, 2024)
1. Information by product and service
This information is omitted because similar information appears under (Segment Information).
2. Information by region(1) Sales: Information on sales by region is omitted because sales to external customers in Japanaccount for over 90% of the net sales amount reported on the consolidated statement ofincome.
(2) Tangible non-current assets: Information on tangible non-current assets by region is omitted
because the amount of tangible non-current assets in Japan accounts for over 90% of theamount of tangible non-current assets reported on the consolidated balance sheet.
3. Information on major customers
Information on major customers is omitted because there were no sales to a single externalcustomer accounting for 10% or more of net sales on the consolidated statement of income.
[Information on Impairment Losses on Non-Current Assets for Each Reportable Segment]
Previous consolidated fiscal year/FY 2022 (April 1, 2022 ~ March 31, 2023)(Thousands of yen)

Impairment losses

PlatformContent

13,170－

Total
13,170Company-wide/
elimination－

Total
13,170Current consolidated fiscal year/FY 2023 (April 1 2023 ~ March 31, 2024)(Thousands of yen)

Impairment losses

PlatformContent

Total

6,387

100,189

106,576

Company-wide/
elimination－

Total
106,576[Information on Amortization of Goodwill and Unamortized Balance for Each Reportable Segment]
Previous consolidated fiscal year /FY 2022 (April 1, 2022 ~ March 31, 2023)(Thousands of yen)

PlatformContent

Total

Company-wide/
Total
elimination
Impairment losses－
1,149,180
1,149,180－
1,149,180(Note) Information on amortization of goodwill is omitted as this information appears in [Segment Information].

Current consolidated fiscal year/FY 2023 (April 1 2023 ~ March 31, 2024)(Thousands of yen)

PlatformContent

Total

Company-wide/
Total
elimination
Impairment losses－
1,028,423
1,028,423－
1,028,423(Note) The amount of amortization of goodwill is omitted as this information appears in [Segment Information].

[Information on Gains on Negative Goodwill by Reportable Segment]
Previous consolidated fiscal year/FY 2022 (April 1, 2022 ~ March 31, 2023) and current
consolidated fiscal year/FY 2023 (April 1 2023 ~ March 31, 2024)
Not applicable18(Per Share Information)(Yen)

FY 2022 (April 1, 2022 ~ March 31, 2023)
FY 2023 (April 1 2023 ~ March 31, 2024)
Net assets per share
1,420.51 Net assets per share
1,224.351
Net loss (△) per share△38.40 Net loss (△) per share△101.13(Notes)1. The amount of net income per share fully diluted during the current fiscal year and diluted net income per share forthe previous fiscal year are not recorded because there are no residual shares subject to a dilution effect.
2. The basis of the calculation of net loss per share is as follows.
FY 2022
FY 2023(April 1, 2022 ~ March 31,(April 1 2023 ~ March 31,
2023)
2024)
Net loss (△) per share
Net loss (△) attributable to the shareholders of the△421,777△1,096,360
parent (thousands of yen)Amount not attributable to ordinary shareholders－－(thousands of yen)
Net loss (△) pertaining to common stock△421,777△1,096,360
attributable to the shareholders of the parent(thousands of yen)
Average number of shares outstanding during the
10,981,526
10,840,526
period (shares)(Note) The Company's shares contributed as trust assets for the performance-linked stock compensation plan are included in
the amount of treasury stock deducted in the calculation of the average number of shares during the period for the
purpose of calculating the net loss per share (257,200 shares for the previous fiscal year ending March 2023, and247,200 shares for the current fiscal year ending March 2024).

3. The basis of the calculation of net assets per share is as follows.
End of FY 2022
(As of March 31, 2023)
Total amount of net assets (thousands of yen)
15,385,889
Amount deducted from total amount of net assets－(thousands of yen)
(Of which, non-controlling interests (thousands of
(－)
yen))
Year-end net assets pertaining to common stock
15,385,889(thousands of yen)
Year-end number of shares of common stock used
10,831,208
in calculating net assets per share (shares)(Significant Subsequent Events)
Not applicable19

End of FY 2023
(As of March 31, 2024)
13,274,133－(－)
13,274,133
10,841,741