2. Business Overview...P.4...P.19

3. Supplementary Materials...P.24

1. Q3 FY2023 Performance

chapterContents

Note on Terms• The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29) is in effect from the beginningof FY2021. Accordingly, ‘‘Net Sales’’ under the old standard are expressed as ‘‘Gross Sales.”• Please note that the gross sales is not official figures that have been audited by the accounting auditor.

• Due to a change in the accounting period starting from FY2021, FY2021 is 9 months for domestic companies
and 12 months for overseas subsidiaries, and FY2021 Q3 is 3 months for domestic companies and 6 months
for overseas subsidiaries.
• The reporting segments starting from FY2022 are as follows: "Agency Business (Domestic/Overseas)," which
provides comprehensive marketing support for apps and websites, and "Ad Platform Business," which
operates UNICORN and affiliate ad services, etc.
• Gross profit margin, SG&A expense margin, operating profit margin, ordinary profit margin, profit margin(profit margin attributable to owners of parent), sales cost margin and posting cost margin are expressed asa percentage of the gross sales above.

Copyright © Adways Inc. All Rights Reserved.

3

Chapter1 : Third quarter results

1

FY2023 Q3.

Copyright © Adways Inc. All Rights Reserved.

Performance4

Quarterly Results (YoY・QoQ)(JPY mn)

FY2023 Q3

FY2022 Q3
FY2023 Q3
Performance
TrendsYoY
FY2022 Q3QoQ
FY2023 Q2Results

ChangeChange (%)

Results

ChangeChange (%)

Gross sales

14,306

14,368-62-0.4%

14,859

-552

-3.7%

Net sales

3,278

3,215

+62

+2.0%

3,387

-109

-3.2%

Gross profit

2,678

2,585

+92

+3.6%

2,740

-61

-2.3%

SG&A expenses

2,651

2,345

+306

+13.1%

2,650

+1

+0.0%

Operating profit

26

239

-213

-89.0%

89-63-70.4%

Ordinary profit

104

303

-199

-65.7%

227-123-54.2%

Profit attributableto owners ofparent

-20

453

-474

ー

71

-91

ー

Gross
sales

YoY
QoQ

Decreased
Decreased

JPY -62 mn -0.4%
JPY -552 mn -3.7%

Copyright © Adways Inc. All Rights Reserved.

Operating YoY Decreased
profitQoQ Decreased

JPY -213 mn -89.0%
JPY -63 mn -70.4%
5

FY2023 Consolidated Performance
Forecast Revision(JPY mn)

Gross sales(Reference)

Net sales

Operating profit

Ordinary profit

Profitattributableto owners ofparentInitial forecasts

64,00014,000

1,750

1,950

1,350

Revisedforecasts(October 31,
2023)

58,91913,500

800

1,120

750

Change-5,081

-500

-950

-830

-600

Change (%)

-7.9%

-3.6%

-54.3%-42.6%-44.4%*Initial forecasts are the figures announced on February 10, 2023, in a press release concerning revision of the performance forecasts and dividend forecasts.

Copyright © Adways Inc. All Rights Reserved.

6

FY2023 Consolidated Performance
Forecast Revision(JPY mn)

Gross sales(Reference)

Net sales

Operating profit

Ordinary profit

Profitattributableto owners ofparentInitial forecasts

64,00014,000

1,750

1,950

1,350

Revisedforecasts(October 31,
2023)

58,91913,500

800

1,120

750

Q3 Results

44,368

10,121

656

907

669

Revisedforecasts
Progress rate
(October 31,
2023)

75.3%

75.0%

82.0%

81.0%

89.3%

*Initial forecasts are the figures announced on February 10, 2023, in a press release concerning revision of the performance forecasts and dividend forecasts.

Copyright © Adways Inc. All Rights Reserved.

7

FY2023 Dividend Forecast Revisions
FY2023 Dividend Forecast
Initial forecasts
Revised forecasts(October 31, 2023)

JPY

7.84

JPY

4.50

per share(Dividend payout
ratio of 23%)

per share(Dividend payout
ratio of 23%)

Regular Dividend Policy (FY2021 – FY2023)
FY2021

FY2022

FY2023

Dividend payout
ratio of 21%

Dividend payout
ratio of 22%

Dividend payout
ratio of 23%

or

or

or

JPY 2.70 per share

JPY 2.80 per share

JPY 2.90 per share

Whichever is higher

Whichever is higher

Whichever is higher*Initial forecasts are the figures announced on February 10, 2023, in a press release concerning revision of the performance forecasts and dividend forecasts.

Copyright © Adways Inc. All Rights Reserved.

8

Revision of Performance Forecasts:
Causes and Countermeasures
Agency Business(Domestic)

The Adways Group’s sales center on game and comic app advertising, but clients’ advertising budget isdecreasing as their revenue is on a decreasing trend due in part to market commoditization* and the
freshness of popular apps showing signs of fading as a long time has passed since these were released.
We are thus focusing on newly tapping advertising beyond game and comic app advertising and haveeven received a large campaign, but this was not enough to offset the decreasing trend in game andcomic app advertising. We will continue to focus on newly tapping advertising beyond game and comic
app advertising, aiming to capture clients without being bound to specific fields.
In addition, the forecast is that the decline in TV viewership will lead to further progress in thetransition from TV commercials to digital media. The Adways Group, too, will increasingly strengthen
efforts to secure advertising in digital media.
*Commoditization: Becoming no longer differentiated in function, quality, etc. as the market is stimulated and othercompanies enter the market

Agency Business(Oversea)

Ad Platform
Business

In Taiwan, a Chinese game company was placing priority on the Japanese and U.S. markets, resulting
in a budget reduction as well as a decrease in the number of major new title releases and such having
a ripple effect on also app advertising. In addition, with the economic downturn, there were also
advertising budget reductions overall in Taiwan, causing brand advertising to also decrease. We arethus seeking to strengthen sales centering on the relatively brisk LINE-related services, such as IDEA
Push and management of official LINE accounts, as well as expanding UNICORN.
In China, the mainstay app advertising and brand advertising were both brisk, but operating profit wasaffected by the recording of provision of allowance for doubtful accounts. Going forward, we will
strengthen client management also.
With UNICORN, business performance has been steadily increasing in recent years, but there wereincreasing cases of the ad delivery logic not working well amid the diversification of the purposes of addelivery and the expansion of handled advertising genres. In addition, the measurement environment
surrounding smartphone app ads is changing globally, but adapting to the changes took time, resulting
in a decrease in gross sales. We have been responding to the diversification of the purposes of addelivery and the expansion of handled advertising genres by updating the ad delivery logic, but this had
caused behavior that was not intended. Although it took time to discover, we have identified thecauses and developed countermeasures and are formulating measures to prevent recurrence. We
believe that there is a risk of losing the effect of ad delivery directly leading to incoming traffic ofpotential customers if we merely simply respond to the changes in the measurement environment, so
we took time to consider and carry out improvements. With both factors addressed during Q3,
improvement can be expected for Q4 onward. We also expect further growth for Q4 onward throughoptimization of YouTube ad delivery and focusing on expansion in Taiwan in brand advertising.

Copyright © Adways Inc. All Rights Reserved.

9

Quarterly Segment Summary
Agency Business(Domestic)

Agency Business(Oversea)

Ad Platform
Business

Segment Gross sales : JPY 5,692 mn
YoY : JPY -211 mn (-3.6%)
Game apps and comic apps remained largely unchanged.
QR mobile payment apps were among those decreasing due to decrease on
the rebound of having conducted promotions on a large scale in the samequarter of the previous year.

Segment Gross sales : JPY 2,355 mn
YoY : JPY -223 mn (-8.6%)
In the app business, there was a budget reduction of a client and decrease in
the number of major new title releases in Taiwan. In the brand business, too,Taiwan’s economic downturn causing budget reductions and other factors
resulted in decrease.

Segment Gross sales : JPY 5,724 mn
YoY : JPY +421 mn (+7.9%)
While UNICORN decreased due to the external environment and imperfectionin the logic, affiliate grew substantially, mainly in the finance genre of JANet.

Copyright © Adways Inc. All Rights Reserved.

10Quarterly Change in Consolidated
Gross Sales
14,36814,417582

587

Gross Sales

5,303

-2.3%

5,182

2,578

-33.6%

1,711

5,904

+17.4%

6,934

FY2022 Q3

15,202

14,859

698

606

5,772

+11.4%-1.8%+29.8%

2,221+29.4%

-6.1%

6,511

-12.3%FY2022 Q4Agency(JPY mn)

Domestic

FY2023 Q1
AgencyOversea

14,306
533

5,666

+1.0%

2,874

-18.0%

5,712

-0.3%

FY2023 Q2
Ad Platf orm

5,724

2,355

5,692

FY2023 Q3Other

Q3 Gross Sales : JPY 14,306 mn
YoY: Decreased JPY -62 mn (-0.4%)
Copyright © Adways Inc. All Rights Reserved.

QoQ: Decreased JPY -552 mn (-3.7%)
11

Quarterly Change in Consolidated
SG&A Expenses(1) Personnel expenditure increased due in part to recording of provision for bonuses whereas not accrued up to Q2(2) Other SG&A expenses increased due in part to recording of provision of allowance for doubtful accounts
Provision for bonuses is expected to be recorded in also Q4.

2,345

2,346

636
SG&A expenses
Personnel

677

2,650

2,651

741

744

59
155
85

65
121
26

17.8%

18.5%

1,608

1,693

2,358
655
26
115
34

56
105
37

59
105
37

16.3%

16.3%

15.5%

1,510

1,466

1,526

FY2022 Q3

FY2022 Q4

FY2023 Q1

Exp enditure Recruiti ng & education expenses(JPY mn)

Rent

FY2023 Q2
Depreciation

Other expenses

FY2023 Q3
SG&A to sales ratio

Q3 SG&A expenses : JPY 2,651 mn
YoY: JPY +306 mn (+13.1%)
Copyright © Adways Inc. All Rights Reserved.

SG&A to sales ratio: 18.5% (+2.2 points)
12

Quarterly Change in Consolidated
Operating Profit(JPY mn)

481

539

239
3.3%

3.6%

1.7%

89
0.6%

FY2022 Q3

FY2022 Q4

FY2023 Q1

FY2023 Q226
0.2%
FY2023 Q3Q3 Operating profit : JPY 26 mn
YoY: JPY -213 mn (-89.0%)
Copyright © Adways Inc. All Rights Reserved.

Operating Profit rate: 0.2% (-1.5 points)
13

Quarterly Change in Consolidated
Operating Profit (By Segment)
481

239

539
68

Operating Profit

497

42
410

495

-13

-555

-479

-582

Ad Platf orm

Operating Profit rate

9.6%

7.7%

7.9%

6.7%

5.7%

FY2022 Q4

FY2023 Q1

4.0%

Other

Agency

26

376

2
271

276

263

▲557

▲510

▲6

AgencyFY2022 Q3

89

455

580

342

(JPY mn)

Adj ust6.7%
3.2%

FY2023 Q2

4.7%
3.3%

FY2023 Q3Ad Platf orm

Q3 Operating profit : JPY 26 mn
YoY: JPY -213 mn (-89.0%)
Copyright © Adways Inc. All Rights Reserved.

Operating Profit rate: 0.2% (-1.5 points)
14

Quarterly Change in Consolidated Ordinary
Profit(JPY mn)

575
493
303
227
3.4%

3.8%

2.1%

FY2022 Q3

1.5%

FY2022 Q4

FY2023 Q1

FY2023 Q2

104
0.7%

FY2023 Q3Ordinary profit: JPY 104 mn
YoY: JPY -199 mn (-65.7%)
Copyright © Adways Inc. All Rights Reserved.

Ordinary Profit rate: 0.7% (-1.4 points)
15

Breakdown of FY2023 Q3 Ordinary Profit

Equity method
investment
incomeGain oninvestments ininvestment
partnerships

Other
income+19

FY2023 Q3Ordinary(JPY mn)
profit
104

+12

+47
FY2023 Q3Operatingprofit26

Equity method investment income

JPY +47 mn

Gain on investments in investment partnerships

JPY +12 mn

Other income

JPY +19 mn

Copyright © Adways Inc. All Rights Reserved.

16

Quarterly Change in Consolidated Profit Attributableto Owners of Parent(JPY mn)

1,127

453

7.8%

618
4.1%

3.2%

71
0.5%

-0.1%

-20
FY2022 Q3

FY2022 Q4

FY2023 Q1

FY2023 Q2

FY2023 Q3Profit attributable to owners of parent : JPY -20 mn
YoY: JPY -474 mn (-)

Copyright © Adways Inc. All Rights Reserved.

Profit Attributable to Owners of parent
ratio: -0.1% (-)
17Breakdown of FY2023 Q3Profit Attributable to Owners of Parent
FY2023 Q3Ordinary
profit(JPY mn)

Gain on sales ofinvestment securities
+12

104

-4
Loss on valuationof investment
securities
FY2023 Q3Profit Attributable toowners of parent

-132

-20

Income taxes
total, Other
Gain on sales of investment securities
Loss on valuation of investment securities
Income taxes total, Other
Copyright © Adways Inc. All Rights Reserved.

JPY
12 mn
JPY -4 mn
JPY -132 mn
18

OVER
. VIEW

Copyright © Adways Inc. All Rights Reserved.

Chapter2: business overview

2

BUSINESS

19

Advertising businessClassification of Advertising BusinessAgency business(Advertising agency)

Other companies’
services
Ad platform business(Advertising distribution
service)

User

Media

Clientetc

We classify our ad business into an agency business that also sells other companies’
services and an ad plaftform business that operates our ad distribution service.
Copyright © Adways Inc. All Rights Reserved.

20

Agency business(Domestic)
Comprehensive app & web marketing support business
Copyright © Adways Inc. All Rights Reserved.

21

Principles of Agency
Business (Domestic)

Third quarter

Digital transformation of marketing as a businessgrowth driver for clients

In our agency business, we provide comprehensive marketing support through integrated offline and online planning.
In order to approach brand advertisers and execute more effective market planning conscious of full-channel1 andfull-funnel2 marketing plans that integrate TV and digital, rather than confining ourselves to an advertising framework,
we are marketing consultants who provide comprehensive marketing support for all types of issues. We also fuse AIbased highly sophisticated marketing technology and human operational and creative capabilities to create essential
advertising value in order to provide comprehensive and efficient support for our clients' business growth.
*1.Full-channel : Widely utilizing media and other channels for attracting customers*2.Full-funnel : Addressing multiple stages of customer activities, ranging from recognition of the product to consideration and purchase (use)Copyright © Adways Inc. All Rights Reserved.

22

Progress of Capital and Business
Alliance with Hakuhodo DY GroupGross Profit from Alliancewith Hakuhodo DY Group

Number of Clients from Alliancewith Hakuhodo DY GroupFY2022 Q3 FY2022 Q4 FY2023 Q1 FY2023 Q2 FY2023 Q3

FY2022 Q3 FY2022 Q4 FY2023 Q1 FY2023 Q2 FY2023 Q3

The graph that was of “gross sales” from the alliance with the Hakuhodo DY Group in the materials up to
FY2023 Q2 has been changed to the graph of “gross profit” from the alliance with the Hakuhodo DY Groupstarting from FY2023 Q3, with retrospective application for prior periods, in order to more accurately
present progress as gross sales is the amount of our margin plus the amount payable to the media insome cases while gross sales is just our margin in other cases.

Gross profit increased slightly YoY
Copyright © Adways Inc. All Rights Reserved.

23

Ad platformbusiness
UNICORN, affiliate ad service business etc.
Copyright © Adways Inc. All Rights Reserved.

24

Principles of Ad Platform
Business (UNICORN)

Third quarter

Three-dimensional expansion
based on channel, value and accountDisplay Ads

Display ads for
smartphone

Video Ads

OTTYouTubeSearch Ads

Other(Performance-Based)

App Storeads

Launched

CTV

In-gameads

DOOH

GoogleSearchUndertesting

UNICORN continues to expand in terms of distribution, working with services such as Connected TV andOTT* in addition to automatically optimized distribution on the Apple Search Ads Today tab, search tab,search results, and product pages. In addition, with testing done, compatibility with YouTube is now
complete and provision of ad delivery menu has commenced. We will continue to optimize user
communication across all channels.
Copyright © Adways Inc. All Rights Reserved.

*OTT (Over The Top): A generic term for content services distributed through the internet.

26

Commencement of YouTube ×Contextual Advertising Menu Provision
Supporting brand advertisers to optimize YouTube ad performance

Delivery to content having
high affinity with the brandEnsuring brand safety

Delivers video of high correlation based onvideo details (information like title,
description, tags, etc.) by utilizing UNICORN’s
unique analytical technology

Keywords that could lead to brand damage
can be set for delivery to exclude channels
that contain those keywords

Natural language processing of video content through text mining of video details.
Delivering ads to video content of high correlation, making it possible
to prevent mismatching between video content and the content of ads
and to approach lead customers.
Copyright © Adways Inc. All Rights Reserved.

27

Progress of UNICORN

Third quarter

Change in UNICORN Gross Sales and Machine Learning Costs(JPY mn)

1,800

1,713

1,600

1,349

1,400

1,417

1,409
1,247 1,217

1,200

978

1,000

1,042

1,404
1,261
1,127

978 988

764

800

629
600
400
200
0

Test operation
period402

317
259 242 268
191
120
89
48 54 60 54 59 69

452
202 215 214 185 189 199
157 170 185 181
109 135 153 139 130 138

FY2 017 FY2 018 FY2 018 FY2 018 FY2 018 FY2 019 FY2 019 FY2 019 FY2 019 FY2 020 FY2 020 FY2 020 FY2 020 FY2 021 FY2 021 FY2 021 FY2 022 FY2 022 FY2 022 FY2 022 FY2 023 FY2 023 FY2 023
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q1
Q2
Q3
Q4
Q1
Q2
Q3

Gross sales
Machine learning costs

In materials up to the end of FY2021, only gross sales of UNICORN Inc were represented, but starting fromFY2022, gross sales are represented as external sales generated by the Group that include transactions ofdepartments exclusively handling UNICORN related sales. As a result, gross sales in materials for FY2021 andearlier and gross sales in this document differ. (Transactions of departments that also handle other products
are not included.)

Change in the external environment and imperfection in the optimization logic
resulted in gross sales being 80% on an YoY comparison
About UNICORN
Copyright © Adways Inc. All Rights Reserved.

28

Progress of UNICORN
Progress by Genre

1,600
1,400

FY2023 Q3 results

67
133

1,200

8%

1,000

4%

87

188

150
51

800

186

600

13%
17%

171

400

58%

651

848

200
0
(JPY mn)Games

BrandsComicsOTTOther

FY 2022 Q3

Games

Brands

FY2023 Q3ComicsOTT

Other“Games” and “Comics” genres decreased
About UNICORN
Copyright © Adways Inc. All Rights Reserved.

29

Progress of UNICORNUNICORN’s Performance: YoY(JPY mn)

YoY FY2022 Q3

FY2023 Q3ResultChangeChange (%)

Gross sales

1,127

1,409

-282

-20.0%

Gross profit

373

490

-117

-23.9%

Operatingprofit

-3

133

-136

ー

Gross sales, gross profit and operating profit each decreased
About UNICORN
Copyright © Adways Inc. All Rights Reserved.

30

Advanced ad method
UNICORN Interactive AD

Cutting-edge creative
formats

Precise ad optimization
with UNICORN

Banner Video Reward Video
Native Interactive

Context Location Demographics
Carrier Approved list

Achieve completely new types of communication with unencounteredusers by using innovative creatives
Copyright © Adways Inc. All Rights Reserved.

31

Commencement of Collaboration for
Realizing Real-Time Ad Delivery to
Digital Billboards
Enabling digital ad delivery
in dynamic and static formats through programmatic buying ofad slots on digital billboards held by PAS.Communications

Provider of an array of services relating to digital
billboards. Media representative for over 150
digital billboards across Japan from Hokkaido to
Okinawa, mainly in the Tokyo metropolitan areasuch as Shibuya and Omotesando.

Increasing new points of contact with users
for clients to achieve brand recognition and user acquisition
Copyright © Adways Inc. All Rights Reserved.

32

Third quarter

伝統と革新が融合する、
あたらしい集合体へ。

Copyright © Adways Inc. All Rights Reserved.

33

Principles of Ad Platform
Business (ADWAYS DEEE)

Update affiliate advertising withnew concepts

Copyright © Adways Inc. All Rights Reserved.

Strengthen service development toimprove consumer experience andmaximize media revenue
34

Release of “JANEEE Block” as
Function Against Fraudulent Traffic
Enabling fraudulent traffic to be detected andchecked via email notification and the “JANEEE Advertising Report” dashboard,
preventing opportunity losses and supporting improvement of ad effectivenessDetection,
notification andvisualization of
fraudulent traffic

Exclusion of
fraudulent
IP addresses

Control offraudulent clicks
Improvement ofad effectivenessPromotes enhancing the transparency and fairness
and ensuring the soundness of affiliate ads
Copyright © Adways Inc. All Rights Reserved.

35

Other Businesses( Non-Advertising )New solutions in non-advertising businesses
Copyright © Adways Inc. All Rights Reserved.

36

Third quarter

Providing New Experiences and Value
Promoting new solutions and business diversificationin non-advertising businesses
Vtuber Business

29 entertainers
Total of approximately 2.29 million subscribers to YouTube channels*As at the end of September 2023

Streaming

Goods/Music

Holding eventsMedia
appearances
TV Asahi Network“GARIBENGER V”
Nippon TV“MUSIC VERSE”… and several others

Providing new experiences in entertainment
Copyright © Adways Inc. All Rights Reserved.

37

“Nanashi Summer Festival 2023”
Held in August 2023
Held “Nanashi inc. × atre Akihabara,” collaboration café,and Nanashi inc.’s first one-on-one talk event

Copyright © Adways Inc. All Rights Reserved.

38

Co-existence of
Humans & Machines

Automate
What humans can’t do

Third quarter

Consolidate what machines
can’t do to humans

Maximize performance
Copyright © Adways Inc. All Rights Reserved.

39

Third quarter

PURPOSE OF ADWAYS
Make the world say“OMG, This is Amazing”
and empower every
person to expand theirpotential, the heart of our“No People, No Gain”
philosophy.

Copyright © Adways Inc. All Rights Reserved.

40

Thank you very much forattending our presentation today
The information provided in this presentation contains forward-looking
statements including Adways Inc.’s current plans, outlook, estimates andforecasts related to its business and industry trends. Such statements are
subject to certain risks and uncertainties. Actual results may differ from theoutlook expressed herein due to risks which may or may not be known atpresent, uncertainties and various other factors. Adways Inc. makes nowarranty that its future outlook and forecasts are accurate, and actual results
may differ materially from company estimates and may be worse than thoseexpressed.
Statements made herein are based on information available as of October 31,
2023, and a variety of factors may cause the statements to differ from actual
results.

Copyright © Adways Inc. All Rights Reserved.

41

SUPPLEMENTARY

Copyright © Adways Inc. All Rights Reserved.

Chapter3 : Supplementary materials

3

MATE
RIALS
.

42

Quarterly Change in Consolidated Gross
Sales(JPY mn)

17,33218,00015,826

16,00014,00014,97814,36814,417

FY2022Q3

FY2022Q4

15,202

14,859FY2023Q1

FY2023
Q2

14,306

13,24412,00010,000
8,000
6,000
4,000
2,000
0
FY2021Q2

FY2021Q3

FY2022Q1

FY2022Q2

FY2023
Q3

Overseas
6-month period*FY2021 Q3 is a 6-month accounting period for overseas subsidiaries in line with the change of fiscal year.

Copyright © Adways Inc. All Rights Reserved.

43

Quarterly Change in Consolidated Cost of Sales(JPY mn)

Listing fee

Other costs

Cost of sales/cons. Sales

Listing fees/Parent sales

15,00014,00013,00012,00011,00010,0009,000
8,000
7, 000
6,000

83.2%

82.1%

83.1%

83.5%

82.9%

81.2%

81.4%

82.1%

82.2%

81.3%

80.9%

82.3%

82.7%

82.0%

80.4%

80.9%

81.6%

81.3%

FY2021Q2

FY2021
Q3
Overseas
6-month period

FY2022Q1

FY2022Q2

FY2022Q3

FY2022Q4FY2023Q1

FY2023Q2

FY2023
Q3

5,000
4,000
3,000
2,000
1,000
0

*FY2021 Q3 is a 6-month accounting period for overseas subsidiaries in line with the change of fiscal year.
*Listing fee and Listing fees/Parent sales show non-consolidated figures and ADWAYS DEEE totals.

Copyright © Adways Inc. All Rights Reserved.

44

Quarterly Change in Consolidated SG&A Expenses(JPY mn)

Personnel

Recrutting&Training

Rent

Depreciation

Other expenses

SG&A/cons. sales

3,000
2,800
2,600
2,400
2,200
2,000
1,800
1,600
1,400
1,200

17.8%

1,000
800

15.0%

16.2%

15.3%

16.3%

16.3%

FY2022Q3

FY2022
Q4

18.5%

15.5%

13.6%

600
400
200
0
FY2021Q2

FY2021Q3

FY2022Q1

FY2022Q2

FY2023Q1

FY2023Q2

FY2023
Q3

Overseas
6-month period*FY2021 Q3 is a 6-month accounting period for overseas subsidiaries in line with the change of fiscal year.

Copyright © Adways Inc. All Rights Reserved.

45

Quarterly Change in Consolidated Operating Profit(JPY mn)
Operating Profit

800

655

700

4.1%
485

Operating Profit ratio

539

507

481

600

3.7%

2.9%

3.6%

3.3%

500

294
400

2.0%
300

239
1.7%
89

200

0.6%
100

26
0.2%

0
FY2021Q2

FY2021Q3

FY2022Q1

FY2022Q2

FY2022Q3

FY2022Q4FY2023Q1

FY2023Q2

FY2023
Q3

Overseas
6-month period*FY2021 Q3 is a 6-month accounting period for overseas subsidiaries in line with the change of fiscal year.

Copyright © Adways Inc. All Rights Reserved.

46

Consolidated Balance Sheet (QoQ)(JPY mn)

FY2023 Q3

FY2023 Q2ChangeChange (%)

Current assets

19,095

18,579

+515

+2.8%

(Cash and deposits)

9,757

9,823

-66

-0.7%

Non-current assets

5,444

5,240

+204

+3.9%

Total assets

24,54023,820

+720

+3.0%

Current liabilities

9,741

9,309

+431

+4.6%

Non-current
liabilities

351

409

-58

-14.3%

Total liabilities

10,092

9,719

+373

+3.8%

Net assets

14,447

14,100

+346

+2.5%

Copyright © Adways Inc. All Rights Reserved.

47

Quarterly Breakdown of Consolidated Sales by Segment
18,00014,36814,417

FY2022 Q3

FY2022 Q4

16,00015,202

14,85914,306FY2023 Q1

FY2023 Q2

FY2023 Q3

14,00012,00010,000
8,000
6,000
4,000
2,000
0

QoQ
(JPY mn)

FY2022 Q3

FY2022 Q4

FY2023 Q1

FY2023 Q2

FY2023 Q3ChangeChange (%)

Agency (domestic)

5,904

6,934

6,511

5,712

5,692

-19

-0.3%

Agency (overseas)

2,578

1,711

2,221

2,874

2,355

-518

-18.0%

Ad platform

5,303

5,182

5,772

5,666

5,724

+58

+1.0%

Other

582

587

698

606

533

-73

-12.1%

Total

14,36814,417

15,202

14,85914,306

-552

-3.7%

Copyright © Adways Inc. All Rights Reserved.

48

Quarterly Change in Group Employees
1,124

1,101

1,112

FY2022 Q3

FY2022 Q4

FY2023 Q1

FY2023 Q2

FY2023 Q3

641

648

649

513

548

543

83

76

72

71

72

72

74

117

132

146

147

137

263

279

280

120

144

138

144

143

148

135

145

133

Temporary workers,
part-time employees

85

105

98

58

64

119

118

68

76

Total

992

1,057

1,054

1,065

1,074

1,124

1,101

1,112

1,106

1,057

1,054

1,065

1,074

FY2021 Q2

FY2021 Q3

FY2022 Q1

FY2022 Q2ADW Japan

602

611

603

ADW China

79

80

Domestic subsidiaries

106

Overseas subsidiaries(excluding China)

1,200

992

1,105

1,000

800

600

400

200

0

（Persons）*Adways Japan decreased and domestic subsidiaries increased due to the ad platform business spinning off and becoming a subsidiary in FY2023 Q1.
Copyright © Adways Inc. All Rights Reserved.

49

Company Overview
Company name

Adways Inc.

FoundedFebruary 28, 2001

Businessoverview

Internet business

CEO
Capital

Sho Yamada
JPY1,716 mn

Gross sales

JPY 59,590 mn

Employees

1,106 (for the entire group)* including temporary workers

Copyright © Adways Inc. All Rights Reserved.

(As at end of September 2023)(FY2022, Consolidated basis)(As at end of September 2023)

50