Financial Results Briefing
Material for Q2 FY2024*The revisions to the consolidated forecast for the second quarter (cumulative)
and full year, announced on February 9th, are reflected in these figures.

May 10, 2024
Securities Code：9438
This report contains forward-looking statements on businessperformance based on the judgments, assumptions, and beliefs
of management using the information available at the time.
Actual results may differ materially due to changes in domestic
or overseas economic conditions or changes in internal orexternal business environments or aspects of uncertainty
contained in the forecasts, latent risks or various other factors.
In addition, risk and uncertainty factors include unpredictableelements that could arise from future events.

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Contents
Financial Results Overview
for Q2 FY2024… P2

Image of medium-term profit … P31

Financial highlight
Consolidated P/LConsolidated SG&A
Difference between earning forecast and the actual for H1

Appendix …P34

Revision of Full-Year earning forecasts
Performance by segment

Approach for the 2 nd half and beyond
Basic policies and priority issues for FY2024
Cloud drug record service
Maternal health record book app + Childcare DX services
School DX business… P19

Consolidated B/SConsolidated P/LConsolidated SG&A
Business of segment
Earnings forecast for FY2024
The list of main healthcare services
Overview of healthcare services
Cloud drug record service
Maternal health record book app + Childcare DX services
School DX business

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1Financial Results Overview for Q2 FY2024

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I would now like to give you an overview of the results for the firsthalf of the fiscal year ending September 2024.

2

Financial highlight
１

Q2 Results
Net sales and income were both higher than the forecast.

YoY

Change fromthe latest forecast¥13,517 million(113) million+517 million

Operating income：¥1,052 million+1,071 million+452 million

Profit attributable toowners of parent：¥1,558 million+1,884 million+318 million

Net sales：

2

Revision of Full-year earning forecast upward
Net sales：

3

Change fromthe latest forecast¥27,000 million

Maintained

Operating income：¥1,800 million+800 million

Profit attributable toowners of parent：¥1,750 million+410 million

Q2 Achievements and initiatives
・Healthcare business：Cloud drug record service and Childcare DX services performing well・School DX business： The number of schools introduced in April 2024 was 255
Copyrights (c) 2024 MTI Ltd. All Right Reserved

Here are the financial highlights.
(1) In the second quarter, net sales were flat compared to the same
period last year, while profits saw a significant increase. Bothsales and profits exceeded the forecasts for the first half of the
fiscal year.
(2) Based on the performance in the first half, the full-year earnings
forecast will be revised upward.
(3) The achievements in the second quarter initiatives are as follows:
In the healthcare business, the number of pharmacies
implementing the cloud drug record and the number ofmunicipalities introducing the childcare DX have been expandingsmoothly, and we have turned profitable in the first half of theyear.
Regarding the School DX business, the number of new
implementations of the full-cloud school affairs support system in
April 2024 reached 255 schools, exceeding the net increase of
the previous year.
We will provide detailed explanations of each specific initiative shortly.

3

Consolidated P/L
Net sales : levelling off
Operating income, ordinary income, profit : substantial increased（ Unit：Mil yen ）FY2023Q2

FY2024
Q2

YoY
AmountPercentage

13,631

13,517(113)(0.8)%

Cost of sales

4,481

3,612

(868)

(19.4)%

ratio

32.9%

26.7%

Gross profit

9,150

9,905

+755

+8.3%

ratio

67.1%

73.3%

SG&A

9,168

8,852

(315)

(3.4)%

ratio

67.2%

65.5%

(18)

1,052

+1,071-%+1,331+711.3%+1,884-%

Net sales

Operating income

-%

7.8%

187

1,518

ratio

(1.4)%

11.2%

Profit attributable toowners of parent

(326)

1,558

-%

11.5%

ratio

Ordinary income

ratio

The same period of previous year:
739million Yen: Posting of spot sales ofthe video-streaming service
・ Loss-making projects in the DX support
business for companies have wound
down
・The same period of previous year:
649million Yen :Posting of spot cost of
sales of the video-streaming service
Decrease in personnel and development
costs
Increase in equity method investment
income (+335million yen)Consumption taxes refund(+786 million yen)

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I would now like to explain the consolidated P/L.
Net sales amounted to ¥13.517 billion, flat compared to the same
period last year, absorbing the decrease from the spot sales of video
content recorded in the previous year.
Cost of sales decreased due to the resolution of loss-making
projects in the corporate DX support business, resulting in a grossprofit of ¥9.905 billion, an increase of 8.3% from the previous year.
Operating income increased significantly to ¥1.052 billion due to adecrease in selling ,general and administrative expenses.
Ordinary income increased significantly to ¥1.518 billion due to anincrease in " a share of profit of entities accounted for using equity
method".
Profit attributable to owners of parent increased significantly due tothe recognition of refunded consumption taxes and other items
recorded in the first quarter.

4

Consolidated SG&A
Advertising expenses: increased
Personnel expenses: exclusion of subsidiary from consolidation
Development costs: improved development costs for the school DX business（ Unit：Mil yen ）FY2023Q2

FY2024
Q2

YoY
AmountPercentage

SG&A

9,168

8,852

(315)

(3.4)%

Advertising expenses

1,016

1,301

+284

+28.0%

Personnel expenses

3,947

3,593

(354)

(9.0)%

Commission fee

1,491

1,416

(75)

(5.1)%

Subcontract expenses

1,059

909

(150)

(14.2)%

591

652

+61

+10.4%

1,062

980

(81)

(7.7)%

Depreciation
Other

Increase in sales promotion
costs for AdGuard
Exclusion of subsidiaries fromconsolidation

Improved development costs(School DX business)

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SG&A decreased by 3.4% year-on-year to ¥8.852 billion.
In the content business, while advertising and promotional expenses
increased, personnel costs decreased due to the exclusion of a
subsidiary from consolidation. Additionally, in the School DX
business, development stabilized, leading to a reduction in
outsourcing costs.

5Difference between earning forecast and the actual for H1
All exceeded expectations（ Unit：Mil yen ）FY2024First-Half

FY2024First-Half（latest forecast）（actual）

Difference(million yen)（%）

13,00013,517+517

4.0%

Operating income

600

1,052

+452

+75.4%

Ordinary income

1,000

1,518

+518

+51.8%

Profit attributable toowners of parent

1,240

1,558

+318

+25.7%Net sales

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Regarding the difference from the forecast for the first half, sales
were up by 4.0%.
Operating income, ordinary income, and the profit attributable toowners of parent for the period each significantly exceeded
expectations.
The main reason is the revenue growth in the healthcare businessand corporate DX support services.

6

Revision of earning forecast of FY2024
Operating income, ordinary income and profit for the period have been revised upward（ Unit：Mil yen ）FY2024Full-YearFY2024Full-Year（latest forecast）（actual）

Difference(million yen)（%）

27,00027,000--Operating income

1,000

1,800

+800

+80.0%

Ordinary income

1,400

2,250

+850

+60.7%

Profit attributable toowners of parent

1,340

1,750

+410

+30.6%Net sales

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Regarding the full-year earning forecast, based on the results of thefirst half, sales will remain unchanged, while profits will be revised
upward.

7

Performance by segment

Content
Business・Content service(Entertainment & Life content)

・Original comics service

Security

Healthcare
Business
・Healthcare service for
women
・Childcare DX service
・Cloud drug record service
・Online consultation
service, etc.

School DX
Business・School DX service

Other
Business
・AI business・DX support businessfor companies
・Solution service forcorporate

comic

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Next, I would like to explain the performance by segment.

8

Content business : Net sales and operating income
QoQ（Unit：Mil yen）
5,100 5,118
4,639

4,436 4,342※1※2

4,384 4,317 4,289
4,210 4,216

Levelled off net sales
The number of paying subscribers
remained almost unchanged.
QoQ

Levelled off operating income
Increased in advertising expenses

2,014
1,534

※1 1,439

1,322 1,328

1,355

1,210 1,218 1,091 1,169

Special factors

1Q

2Q

3Q

4Q

1Q

FY2022

2Q

3Q

FY2023
Net sales

Operating income

4Q

1Q

2Q

FY2024*1：Net sales & Operating income 717 million yen:
Change in treatment of consumption tax in monthly
content services that award points.
*2：Net sales 739 million yen:
Posting of spot sales of the video-streaming service.

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This is the quarterly trend of the content business.
Due to the number of paid members remaining flat, both net sales
and operating profit continue to show a flat trend.
The second quarter net sales amounted to ¥4.216 billion, and theoperating income was ¥1.169 billion.

9

Content business : The number of paying subscribers

Total paying subscribers

3.63 million subscribers
5.00

4.81

4.25 4.08

4.67 4.59

4.48 4.38

3.96 3.88 3.78

4.23 4.16

3.69 3.57

3.52

3.95 3.89

Total paying subscribers

Flat3.80 3.79 3.76 3.73 3.69

3.33 3.27 3.20 3.20

3.68 3.63 3.63

・Brisk Security-related app

3.18 3.16 3.14 3.13 3.09 3.10

0.75 0.73 0.71 0.71 0.70 0.69 0.66 0.64 0.62 0.62 0.60 0.59 0.58 0.57 0.55 0.55 0.54 0.53
1Q

2Q

3Q

FY2020

4Q

1Q

2Q

3Q

4Q

1Q

FY2021

Healthcare business

2Q

3Q

FY2022

4Q

1Q

2Q

3Q

FY2023

4Q

1Q

2Q

FY2024

Content business

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The number of paid subscribers in the content business remained
steady overall, and including members from the healthcare business,
it reached 3.63 million at the end of March.

10

Content business: Security-related app

The security-related
app continues toperform well

Total paying subscribers

Total paying subscribers

780 thousand subscribers
Four functions

Ad blocking

Trace blocking

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
FY2020

FY2021

FY2022

FY2023Threat blocking

Parent function（Child protection
function）

FY2024

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The number of new subscribers for the security-related app"AdGuard" has been performing well, and the number of paid
members reached 780,000 at the end of March.

11

Content business: Original comics content businessNet sales

Original comics content businessStable trend
・Keep in comic titles introduced
・ Reactionary decline after TV dramatization

1Q 2Q 3Q

4Q 1Q 2Q 3Q

FY2020

FY20214Q 1Q

2Q 3Q 4Q
FY20221Q

2Q 3Q 4Q

1Q 2Q

FY2023

FY2024

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The original comic business is also progressing well.
The adaptation of popular works into TV dramas has temporarily
increased download numbers, leading to a surge in revenue.
Although there is a reduction due to recoil after the TV adaptations,overall, the situation remains stable.

12

Healthcare business: Net sales and operating income（Unit：Mil yen）

908

977

1,031

1,184 1,181

1,113

1,239 1,260

1,355

QoQ

Net sales growth

1,011

QoQ

112

104

9

(336)

(311)

1Q

2Q

(250)

3Q

(172)

(209)

4Q

・Brisk Cloud drug record service
・Brisk Childcare DX service

(13)

(46)

1Q

FY2022

2Q

3Q

FY2023
Net sales

4Q

Operating income ison a positive trend

1Q

2Q

FY2024

Operating income
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The healthcare business achieved sales of ¥1.355 billion.
The cloud drug records and childcare DX services are expandingsmoothly, and revenue is steadily accumulating.
Operating profit reached ¥140 million, driven by the effects ofincreased revenue and the reduction of selling and administrative
expenses.
The company has continued to be profitable since the fourth quarterof the previous fiscal year.

13

Healthcare business: Monthly content service

Total paying subscribers(LunaLuna, CARADA medica)

0.53 million subscribers

Monthly subscription content service
Total paying subscribers

Levelled off
0.75 0.73

1Q

2Q

0.71 0.71 0.70 0.69

3Q

FY20204Q

1Q

2Q

0.66 0.64

3Q

FY2021

4Q

0.62 0.62 0.60

1Q

2Q

3Q

FY20220.59 0.58 0.57

4Q

1Q

2Q

0.55 0.55 0.54 0.53

3Q

FY2023

4Q

1Q

2Q

FY2024

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The number of paying subscribers in the healthcare business was
mostly unchanged at 530,000.

14

Healthcare business: Cloud drug record service

+167

2,090

2,090

pharmacies
introduced

1,923
1,793
1,639
1,532

1,096
978

573
285
64

357

Total introduced pharmacies

Steady expansion

1,382
1,264

765

Cloud drug record service

864

633

451

163

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
FY2020

FY2021

FY2022

FY2023

FY2024

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The number of pharmacies introducing the cloud drug record service
has reached 2,090 stores, showing steady expansion.

15

School DX business: Net sales and operating income
Increased
revenue at thestart of theschool year
272

270

260

260

（Unit：Mil yen）
150
55

(121)

154

155

Levelled off net sales

153

65

Expansion in sales compared to thesame period last year
(107)

(111)

(246)

(99) (82)

(79)

2Q

3Q

4Q

1Q

FY2022

2Q

3Q

FY2023

Net sales

QoQ

Operating deficit unchanged(214)(302) (305)
1Q

QoQ

4Q

1Q

2Q

Significant reduction in losses comparedto the same period last year

FY2024

Operating income

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Sales for the School DX business reached ¥260 million.
While flat compared to the immediately preceding quarter, there has
been expansion compared to the latter half of the previous period.
Due to the concentration of new installations of the cloud-based
school affairs support system "BLEND" in April, which marks thestart of the school year, revenue tends to accumulate in the second
half of the fiscal year.
Operating loss amounted to ¥79 million.
Although the deficit remains flat compared to the immediately
preceding quarter, the operating loss has significantly decreased
since the latter half of the previous period, due to the effects ofincreased revenue and reduced development costs.

16

School DX business: Cloud-based school affairs support system

Total introduced schools
775

541

The number of schools
introducing our services
is progressing wellPrivate high school share

340

expanded to 35%

114

2021年4月
April,
2021

2022年4月
April, 2022

2023年4月
April, 2023

2024年4月
April, 2024
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In the school affairs support system, there is an increasing demand
for the full-cloud model.
The implementation of "BLEND," offered by our subsidiary, is
progressing well. As of April 2024, the number of new installations
reached 255 schools, exceeding the previous year's total, and themarket share in private high schools has expanded to 35%.

17

Other business (Includes DX support business for companies, AI) :Net sales and operating income（Unit：Mil yen）

1,473
1,261 1,277 1,205

1,102

1,282
1,190 1,227 1,183 1,221

QoQ

Net sales growthOrders in the corporate DX support business increased
55

(36)

(140)

(178)

(251)

Operating loss eliminated(87)(397) (393) (413) (413)

1Q

2Q

3Q

4Q

FY2022

1Q

2Q

3Q

FY2023

Net sales

QoQ

Orders in the corporate DX support business increased
4Q

1Q

2Q

FY2024

Operating income
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Sales for the other businesses amounted to ¥1.473 billion, with anoperating profit of ¥55 million.
Due to the expansion of orders in the corporate DX support business,revenue has increased, allowing us to eliminate the operating deficit.
That concludes the financial summary for the second quarter.

18

Approach for the 2 nd half and beyond

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Next, I would like to explain the approach for the 2 nd half andbeyond.

19

Basic policies and priority issues for FY2024

１. Healthcare business

Further sales growth・ Further expansion of the Cloud drug record service
・ Promotion of the platform strategy of the childcare DX, "Boshimo"

２. School DX business

Further sales growth・Expansion of the number of introduced schools

3. Content business

Securing profit
・ Original comics content business growth・ Security-related app growth

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In each segment, we will focus on priority issues based on thefollowing basic policies, respectively.
・In the healthcare business, we aim for further sales growth andachieve profitability for the full fiscal year. Specifically, we will focus
on expanding the Cloud drug record service and advancing theplatform strategy for the childcare DX.
・In the School DX business as well, we aim for profitability in thesecond half through further sales growth.
・ In the content business, while the number of monthly paid
subscribers remains steady, we aim to ensure profitability across thesegment through the growth of security-related apps and theoriginal comic business.

20

Healthcare business: Cloud drug record service

Connecting pharmacies and patients

Cloud drug record service

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I will explain the progress of the cloud drug record service in thehealthcare business.

21

Healthcare business: Cloud drug record service

Continuing to strengthen cooperation in sales and to
reinforce function development
1. Continuing to strengthen cooperation in sales•

Collaboration with a major prescription pharmaceutical wholesaler

2. Continuing to strengthen function development for differentiation•

Connecting the drug histories possessed by different pharmacies•

Home care and nursing functions•

Additive Logic, Guidance Navigation•

Planning to add electronic prescriptions and other functions as needed
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In the cloud drug record service, the number of pharmacies thathave introduced dispensing pharmacies is steadily increasing.
We will continue to strengthen our sales efforts and enhance thefunctionality of the service.

22

Healthcare business:
Maternal and child health handbook app + Childcare DX services
Connecting parenting households and municipalities & hospital

Maternal and child health handbook app+ Childcare DX services

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Next, I would like to explain our progress targets for the maternaland child health handbook app “Boshimo” and childcare DX services.

23

Healthcare business:
Maternal and child health handbook app + Childcare DX services"Childcare support" is a social issue

Delay in digitalization for childcare support
Paper-based proceduresChildcare-related
procedures

Extremely inefficient

Digitalization isa pressing issue
Guardian

Municipal

Immunization facilities

Parents forced to visit the office with small children, long waiting times
Parents asked to enter the same things every time in questionnaires
Much paperwork is written by hand, and specifications vary between municipalities
Copyrights (c) 2024 MTI Ltd. All Right Reserved"Childcare support" has become one of the social issues.
Additionally, the development of environments that support
childcare by municipalities and medical institutions is also lagging.
In municipalities and medical institutions using traditional businesssystems, there is still a prevalence of paper applications andadministrative processes, which also places a burden on parents. It
can be said that this leads to an extremely inefficient situation.
To resolve this issue, the digitalization of childcare support has
become a pressing issue.

24

Healthcare business:
Maternal and child health handbook app + Childcare DX services

Childcare DX ser vices
・ Questionnaire and reservation
form functionality
・ Childhood immunizations(Digital preliminary examination slip , etc.)

・ Infant health checkup
・ Visits to all households with infants
・ Pregnancy checkups andpregnancy notification

Functions

Digitalization of municipal services
and cooperation with medical
institutions in the childcare field
Effects

Municipal
Data linkage
Data linkage

e.g. : Infant healthcheckup service

Reducing the burden on parents,
municipalities, and medical
institutions through data linkage
Values“Boshimo” app

Guardian
Data linkage

Immunization
facilities
Health checkvenue

Promoting municipal childcare
DX and improving the local
childcare environment
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By introducing our childcare DX service, we dramatically improvethe childcare services offered by municipalities.
We digitize all procedures for various services, reducing the effort
and burden on parents, municipalities, and medical institutions.

25

Healthcare business:
Maternal and child health handbook app + Childcare DX services
Accelerated introduction of childcare DX services at municipalities using “Boshimo”
Phase2Phase3

Online consultation

Childcare DX services

94

163

Phase1

Maternal and childhealth handbook app

606

1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q

Tailwind for the“Accompanying Support
Program”*

FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023 FY2024

4Q

1Q

FY20202Q

3Q

FY2021

4Q

1Q

2Q

3Q

FY2022

4Q

1Q

2Q

3Q

FY2023

4Q

1Q

2Q

FY2024

1Q

2Q

3Q

FY2022

4Q

1Q

2Q

3Q

FY2023

4Q

1Q

2Q

FY2024* Transferred to “Children and Families Agency” from April 1,2023 .
Copyrights (c) 2024 MTI Ltd. All Right Reserved

The maternal and child health handbook app "Boshimo" has been
implemented in 35% of municipalities nationwide.
At the end of March, the number of installations reached 606.
The number of municipalities that have also introduced the online
consultation service has reached 94.
The implementation of the childcare DX service has accelerated,
increasing to a total of 163 at the end of March.
This is also backed by the government's efforts to support thedigitalization and DX of childcare services.

26

School DX business

Motivation Works Inc.

Connecting students and teachers

Full-cloud school affairs support system

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Next, I would like to explain more about the school DX business.

27

School DX business：Full-cloud school affairs support system

Motivation Works Inc.

Serious problems in schools

Excessive teacher overtime andincreased resignations
Traditional school affairs

Excessive workload
and inefficiency

Shifting all schoolaffairs to the cloudis a pressing issue

Using multiple systems: management cost burden
Varying specifications, handwritten and PC-based admin: work-time burden
Data linkage is time consuming

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In schools, issues such as excessive overtime and rising resignation
rates among teachers are becoming increasingly serious.
In addition to teaching, teachers are responsible for various types ofadministrative tasks, collectively referred to as "school affairs."
Primarily, these include attendance management, grading, entrance
exam administration, and communication tasks.
The workload for these tasks is substantial, and with traditional
school affairs systems, management is not centralized, leading to
extremely inefficient conditions.
Furthermore, the use of multiple school affairs systems also leads toincreased costs.
To address these serious issues all at once, the full-cloud
implementation of school affairs systems is receiving significant
attention from the Ministry of Education, Culture, Sports, Scienceand Technology, as well as from schools sites.

28

School DX business：Full-cloud school affairs support system

Motivation Works Inc.

A world with

FunctionsEliminating all negatives

・ Fully cloud-based centralized management of data
・ Data linkage without returning to the staff room
・ Data linkage with parents and guardians

Teachers-only
functions

Effects
General Public
Functions・ Reduced workload for school affairs
・ Reduced system management costs
ValuesTeachers’ terminal

Students’ terminal

Parental
Cooperation

Create an environment that enables
concentration on essential education
through the provision of school DX services

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Our group has been at the forefront in developing and providing"BLEND," a full-cloud school affairs support system.
By implementing it, schools can be freed from inefficientadministrative tasks.
Since it is fully cloud-based, the system allows for centralized
management of various school administrative data, enabling staff toenter and access data on the spot without needing to return to thestaff room.
Additionally, it enables information sharing with parents as needed.
Not only does it reduce the workload of school affairs, but also
improves management costs having a single system that is fullcloud-based.
At schools where it has been implemented, these reductions in"burdens" enable the creation of an environment where educators
can focus more on the core aspects of teaching.

29

School DX business：Full-cloud school affairs support system

Image of medium-term profit

PlannedMotivation Works Inc.

Continued increase in the numberof schools introducing DX
Growthopportunities

・Accumulation of projects expected to be
introduced in April 2025
・Government driving DX for school affair
in prefectural areas
Differentiation
FY2021 FY2022 FY2023 FY2024 FY2025 FY2026

Cloud-based batch services

Copyrights (c) 2024 MTI Ltd. All Right Reserved

Here is an image of medium-term profit for the school DX business.
Projects are accumulating in preparation for implementation in April
2025.
Additionally, the government is advancing the implementation ofschool DX initiatives at the prefectural level.
When schools consider introducing a school affairs support system,
they see significant advantages in the "full-cloud" model that
"BLEND" embodies.
By fully leveraging these opportunities and advantages, we aim tofurther expand the number of schools introducing the system,
thereby achieving growth in revenue and profits.

30

Image of medium-term profit

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Next, I will explain the image of medium-term profit.

31

Image of medium-term profit
Our Group

Healthcare business（by segment）

Focus on expansion of stock sales (=profit)

Content business

School DX business
Sharp growth in a short period of time

Other business(Includes DX support business forcompanies, AI)

Factors affecting profit
Healthcare business

School DX businessGovernment promotion of digitalization / DX in mother and child health information(Improving the childcare environment is a pressing issue )⇒ Accelerated introduction of digital maternal and child health handbook and childcare DX
Government driving DX for school affair in prefectural areas(Improving efficiency in school administration is a pressing issue)⇒ Accelerated introduction of full-cloud school affairs support systems
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The image of medium-term profit is as follows.
We have invested in the healthcare and school DX businesses, using
the content business as a cash cow.
Since we anticipate that the school DX business will be the fastest toachieve business growth, we will continue to work on expanding thenumber of schools that introduce our full-cloud school affairs
support system.
The healthcare business has finally become profitable, and webelieve it will serve as a key driver of profit growth in the medium
term.
In the current fiscal year, we plan to achieve full-year profitability by
driving sales growth through our cloud-based drug record andchildcare DX services.
Through the expansion of stock sales in each business, we aim toachieve "sustainable growth" across the entire group.

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〈Contact us〉
Investor Relations Officee-mail: ir@mti.co.jp
https://ir.mti.co.jp/eng/

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Thank you for your time.

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