UNOFFICIAL TRANSLATION
The formal official document is in Japanese

Summary of Consolidated Financial Results for the First Half of
Fiscal Year ending September 30, 2023 (Japanese Accounting Standards)
May 11, 2023
Listed Company Name: MTI Ltd.
Listing Exchanges: Tokyo Stock Exchange
Securities Code:9438
URL: https://ir.mti.co.jp/eng/
Representative:
Toshihiro Maeta, President and Chief Executive Officer
Contact:
Hiroshi Matsumoto, Senior Managing Director
Phone: +81-3-5333-6323
Scheduled date to submit the Quarterly Securities Report (Shihanki Houkokusho): May 15, 2023
Scheduled date of dividend payment: June 16, 2023
Supplementary documents for quarterly results: Yes
Quarterly results briefing: Yes (for securities analysts and institutional investors (on demand))(Figures less than one millions of yen are omitted)

1. Consolidated business results for the six months ended March 31, 2023
(October 1, 2022 – March 31, 2023)(Percentages represent year-on-year changes)(1) Consolidated operating results (cumulative total)
Net sales

Operating income

Millions of yen

First half of fiscal year ending
September 30, 2023
First half of fiscal year ended
September 30, 2022
(Note) Comprehensive income:% Millions of yen

Profit attributable toowners of parent

Ordinary income% Millions of yen% Millions of yen%

13,631

5.1

(18)

–

187

(36.1)(326)–

12,975(0.5)

599(51.4)

292(65.2)

123–

Six months ended March 31, 2023: (391) millions of yen –%Six months ended March 31, 2022: 47 millions of yen –%Net income
Net income
per shareper share/diluted

First half of fiscal year ending
September 30, 2023
First half of fiscal year ended
September 30, 2022

Yen

Yen

(5.95)

–

2.25

2.25

(2) Consolidated financial position
Total assets

Equity ratio

Millions of yen%

28,87929,265

17,052
17,87746.2
48.1

As of March 31, 2023
As of September 30, 2022
(Reference) Shareholders’ equity:

Net assets

Millions of yen

As of March 31, 2023: 13,349 millions of yen
As of September 30, 2022: 14,065 millions of yen

2. Dividends
End of firstquarterYen

End of second
quarter
Yen

Fiscal year ended September–
8.00
30, 2022
Fiscal year ending September 30,
–
8.00
2023
Fiscal year ending
September 30, 2023(forecast)(Note) Revisions to dividend forecasts published most recently: No

Dividend per share
End of third
quarterYear end

Annual

Yen

Yen

Yen

–

8.00

16.00

–

8.00

16.00

3. Forecast for consolidated business results for the fiscal year ending September 30, 2023
(October 1, 2022 – September 30, 2023)
Net sales
Millions of yen(Percentages represent year-on-year changes.)
Profit attributable to
Net income
Ordinary income
owners of parent
per share

Operating income% Millions of yen%

Millions of yen% Millions of yen

Full year
26,8001.2
200 (77.0)
400(17.7)(Note) Revisions to forecasts for consolidated business results published most recently: Yes

(400)

%

Yen

–

(7.29)* Note:(1) Important changes of subsidiaries during the term(changes in specified subsidiaries resulting in change in scope of consolidation): Not applicable
New: –
Exception: –(2) Application of specific accounting treatment to the preparation of quarterly consolidated financial statements: Not

applicable(3) Changes in accounting policies and changes or restatement of accounting estimates(i) Changes in accounting policies due to the modification in accounting methods:(ii) Changes in accounting policies other than (i):(iii) Changes in accounting estimates:(iv) Restatement:

Not applicableNot applicableNot applicableNot applicable(4) Number of outstanding shares (common shares)(i) Number of shares outstanding at the end of period (including treasury shares):3/23:61,263,000 shares
9/22: 61,263,000 shares(ii) Number of treasury shares at the end of period
3/23: 6,399,973 shares
9/22: 6,450,273 shares(iii) Average number of shares during the period (quarterly consolidated cumulative period)
Six months ended 3/2023: 54,820,844 shares

Six months ended 3/2022: 54,762,393 shares* Status of a quarterly review
This earnings release is not subject to an audit.

* Cautionary statement with respect to forward-looking statements
The forward-looking statements included in this material are based on the Company’s judgments, assumptions, and convictions
based on information available to the Company at the time of publication of this document and may differ materially from actual
results for a range of factors, including conditions of Japanese and overseas economies, changes in the situation of operations inJapan and overseas, and uncertainties and potential risks inherent in forward-looking statements. The risks and uncertainties include
unforeseeable effects of future events. The information on consolidated earnings forecasts and other future forecasts on page 4 of
the Accompanying Materials describes notes on the assumptions of the earnings forecasts and the use of the earnings forecasts.
A video (Japanese) of the briefing on earnings for the first half for securities analysts and institutional investors will be madeavailable on demand on the Company's website.

Accompanying materials – Contents
1. Qualitative information on financial results for the current settlement ................................................................... 2(1) Explanation on operating results ..................................................................................................................... 2(2) Explanation on financial position ................................................................................................................... 3(3) Explanation of future forecast information including consolidated forecast .................................................. 4
2. Quarterly consolidated financial statement and important notes ............................................................................... 5(1) Quarterly consolidated balance sheet ................................................................................................................ 5(2) Quarterly consolidated statement of income and quarterly consolidated statementof comprehensive income ............................................................................................................................... 7(3) Quarterly consolidated statement of cash flows .............................................................................................. 9(4) Notes concerning quarterly consolidated financial statements ......................................................................11(Notes concerning going concern assumption) .............................................................................................11(Notes in the event of significant changes in shareholders’ equity) ..............................................................11(Segment information, etc.) ........................................................................................................................................ 11-1-

1. Qualitative information on financial results for the current settlement(1) Explanation on operating results
Overview of the first half ended March 31, 2023 (Period from October 1, 2022 to March 31, 2023)
The Group is actively engaged in the healthcare business and the school DX business, both of which are expected
to expand in the future, in order to enhance its corporate value over the medium to long term.
During the first half under review, consolidated net sales stood at ¥13,631 million (up 5.1% year on year) andgross profit at ¥9,150 million (down 0.1 % year on year), attributable to an increase in cost of sales.
The operating loss was ¥18 million (compared to operating income of ¥599 million in the same period of theprevious year) due to an increase in selling, general and administrative (SG&A) expenses due chiefly to a risein advertising expenses and outsourcing expenses.
Ordinary income stood at ¥187 million (down 36.1% year on year) due to equity-method investment profit of¥174 million (compared to equity-method investment loss of ¥329 million in the same period of the previousyear).
A loss attributable to owners of parent came to ¥326 million (compared to profit of ¥123 million in the sameof the previous year). This mainly reflected the postponement of the recording of deferred tax assets and income
taxes-deferred in the consolidated financial statements in accordance with the current accounting standards forthe income tax-related treatment of a gain on the transfer of shares, associated with the transfer of some of theshares in Boshimo Ltd., a consolidated subsidiary, to MTI Healthcare Holdings Inc., a consolidated subsidiary,in October 2022, which more than offset gain on changes in equity of ¥139 million posted as an extraordinary
income.
Consolidated business results(Period from October 1, 2022 to March 31, 2023)
ChangeFirst half of the fiscal year
ending September 30, 2023

First half of the fiscal year
ending September 30, 2022

Millions of yen

Millions of yen

Millions of yen%

13,631

12,975

+655

+5.1

4,481

3,814

+666

+17.5

Gross profit

9,150

9,160

(10)

(0.1)

SG&A

9,168

8,561

+607

+7.1

Operating income

(18)

599

(617)

－

Ordinary income
Profit attributableto owners of parent

187

292

(105)

(36.1)

(326)

123

(449)

－

Net sales
Cost of sales

AmountPercentage

Breakdown of SG&A
(Period from October 1, 2022 to March 31, 2023)
ChangeFirst half of the fiscal year
ending September 30, 2023

First half of the fiscal year
ending September 30, 2022

Millions of yen

Millions of yen

Millions of yen

%

9,168

8,561

+607

+7.1

Advertising expenses

1,016

758

+258

+34.1

Personnel expenses

3,947

3,835

+111

+2.9

Commission fee

1,491

1,538

(46)

(3.0)

Subcontract expenses

1,059

885

+173

+19.6

591

633

(42)

(6.7)

1,062

909

+152

+16.8

Total

Depreciation
Other

-2-

AmountPercentage

Operating results by segment are as follows.
Effective from the first quarter of the consolidated fiscal year under review, the classification of reportablesegments has been revised. Comparison and analysis for the first half under review are based on the new segments.
① Content business
The content business includes B2C monthly billing services (excluding the “Luna-Luna” healthcare service
for women and the “CARADA medica” health Q&A service in cooperation with healthcare professionals)
and the B2B original comic distribution business that offers original comic content to comic distributors.
This segment served 3.16 million of paying subscribers. The figure was 40 thousand smaller than at the endof September 2022. The number of paying subscribers was nearly level, reflecting an increase in the numberof paying subscribers to the “AdGuard” security-related app.
Net sales came to ¥9,502 million (up 4.7% year on year) mainly due to video sales at the consolidated
subsidiary Video Market Corporation, despite a decrease in the number of paying subscribers compared tothe same period last year.
Operating income was ¥2,794 million (down 2.2% year-on-year) due to an increase in SG&A expenses
resulting from a rise in advertising expenses to promote “AdGuard” membership.
② Healthcare business
The healthcare business includes B2C monthly billing services under the “Luna-Luna” and “CARADA
medica” brands and B2B and B2B2C healthcare services for medical institutions and local governments,
such as the cloud drug record service and the maternal health record book app.
This segment served 570 thousand of paying subscribers. The figure was 20 thousand smaller than at theend of September 2022. On the other hand, the number of pharmacies that offer the cloud drug record service
came to 1,532 at the end of March 2023 (up 268 from the end of September 2022), as the result of great
efforts focused on increasing the number of pharmacies whose motivation to introduce such service is
growing.
Net sales came to ¥2,195 million (up 16.4% year on year), given expanded sales of Cloud drug record
service and Childcare DX service, etc. Operating loss stood at ¥219 million (compared to a loss of ¥648
million in the same period of the previous year), attributable to the effect of increased sales and cost
containment measures.
③ School DX business
The school DX business includes school DX business developed for educational institutions by the
consolidated subsidiary Motivation Works Inc.
Net sales amounted to ¥309 million (up 155.1% year on year) due to an increase in monthly usage fees fromeducational institutions that newly introduced the “BLEND” cloud-based school business support system in
April 2022. Despite the significant increase in net sales, the operating loss amounted to ¥461 million(compared to a loss of ¥232 million in the same period of the previous year) due to an increase insubcontracting expenses resulting from stricter recording of software assets from the second half of theprevious fiscal year.
④ Other business
Other business includes the B2B AI business operated by Automagi Inc., a consolidated subsidiary, and theCompany’s DX support business for large companies and solution business.
Net sales amounted to ¥2,417 million (down 4.8% year on year) due to a decrease in orders for the AI
business. Operating loss was ¥807 million (compared to an operating loss of 176 million yen in the same
period of the previous year), primarily reflecting an increase in the cost of sales as a result of the ongoing
response to low-margin projects in the DX support business for major corporate customers in addition to
decreased sales in the AI business.

(2) Explanation on financial position① Assets, liabilities and net assets
At the end of the first half under review, total assets decreased ¥386 million from the end of September 2022,
to ¥28,879 million.
Current assets decreased ¥553 million mainly due to a fall in consumption taxes refund receivable despite
an increase in cash and deposits. Non-current assets rose ¥167 million chiefly due to an increase in investment
securities, which more than offset a decrease in goodwill and customer-related assets.
Current liabilities increased ¥741 million, mainly reflecting rises in income taxes payable. Non-current
liabilities fell ¥302 million chiefly due to a decline in long-term borrowings.
Net assets decreased ¥825 million due to a loss attributable to owners of parent of ¥326 million and dividend
payments.
-3-② Consolidated cash flows
At the end of the first half of the fiscal year under review, cash and cash equivalents were ¥12,763 million,up ¥665 million from the end of September 2022. Cash flow by activity and principal factors in the first half
under review are as follows:
Net cash provided by operating activities resulted in an inflow of ¥2,105 million (outflow of ¥788 million
in the same period of the previous fiscal year). This is mainly a reflection of profit before income taxes, anincrease in depreciation and received consumption taxes refund receivable, which more than offset income
taxes paid.
Net cash used in investing activities resulted in an outflow ¥616 million (outflow of ¥1,413 million in thesame period of the previous fiscal year). Major factors included expenditure for the purchase of intangible
assets (mainly software).
Net cash used in financing activities resulted in an outflow ¥798 million (outflow of ¥776 million in thesame period of the previous fiscal year). The main factors included payments of dividends and repaymentsof long-term borrowings.
Net cash provided by(used in) operating
activities

Net cash provided by(used in) investing
activities

Net cash provided by(used in) financing
activities

Cash and cash
equivalents at end of
periodMillions of yen

Millions of yen

Millions of yen

Millions of yen

First half of the fiscal year ending
September 30, 2023

2,105

(616)

(798)

12,763First half of the fiscal year ending
September 30, 2022

(788)

(1,413)(776)

12,590For the fiscal year ended
September 30, 2022

(1,393)(2,460)343

12,097(3) Explanation of future forecast information including consolidated forecast
The Company will work hard to expand sales and cut losses of its healthcare business, which is expected to playa key role in increasing revenue and earnings in the future. In the content business, it will make every effort toincrease the number of paying subscribers by expanding sales of the “AdGuard” security-related app and striving
to bolster the original comic distribution business.
Also, the Group will focus on expanding the school DX business that Motivation Works Inc., a subsidiary of
the Company, is actively working to develop. Given the large number of business inquiries related to “BLEND”,
the cloud-based school affairs support system provided by Motivation Works, 566 schools introduced this system
beginning in April 2023 (increased 226 compared to April 2022). Although it is necessary to continue upfront
investments for some time, they will lead to the continued growth of sales.
The Company takes medium- and long-term perspectives in its engagement in the healthcare business, which
has strong potential for future growth and compared with B2C transactions, may move toward a more stable
stock-type business through the establishment of long-term business relationships with customers. Therefore,
the Company is committed to implementing a variety of measures to achieve sales growth.
The cloud drug record service is particularly in high demand in dispensing pharmacies and we will increase
the number of introducing stores through enhancing cooperation with Medipal Holdings, our business partner.
This is because it can contribute to the sustained growth of sales in the healthcare business.
It will also enhance childcare-related services with a focus on local governments that have introduced the“Boshimo”, a maternal health record book app, and will advance digital cooperation among local governments,
hospitals, and residents, thereby advancing its “Boshimo” childcare DX platform strategy to enable thehealthcare business to make a contribution to profit in the medium term.
With regards to forecasts for consolidated business results for the fiscal year ending September 30, 2023, wehave revised it as announced today in the "Notice Regarding Differences between Forecasts and Actual Results
for the First Half of the Fiscal Year, and Revisions to Full-Year Results Forecast."
Earnings forecast for the fiscal year ending September 30, 2023
(Period from October 1, 2022 to September 30, 2023)(Millions of yen)

YoY(%)Net sales

26,800+1.2

Operating income

200(77.0)

Ordinary income

400(17.7)

Profit attributable toowners of parent

(400)

－

-4-

2. Quarterly consolidated financial statement and important notes（1） Quarterly consolidated balance sheet（Unit: thousands of yen）
Previous fiscal year
(As of September 30, 2022)

The current first halfof the fiscal year
(As of March 31, 2023)

AssetsCurrent assets
Cash and deposits

12,097,658

12,763,647

Notes and accounts receivable-trade, and contract assets

4,294,825

4,512,835

Other2,420,195

981,139

Allowance for doubtful accounts(34,097)(32,814)

18,778,582

18,224,807

193,060

221,499

Software2,058,982

2,165,980

Goodwill

655,709510,531

Customer-related assets

912,600

702,000

Other

163,473

204,126

3,790,765

3,582,639

3,675,499

4,001,987

337,475

333,005

2,394,793

2,404,868

Other

106,411

121,347

Allowance for doubtful accounts(10,904)(10,904)

Total investment and other assets

6,503,275

6,850,304

10,487,102

10,654,442

29,265,684

28,879,249

Total current assets
Non-current assets
Property, plant and equipment
Intangible assets

Total intangible assets
Investments and other assets
Investment securities
Leasehold and guarantee deposits
Deferred tax assets

Total non-current assets
Total assets-5-

(Unit: thousands of yen)Previous fiscal year
(As of September 30, 2022)

Liabilities
Current liabilities
Account payable-trade
Short-term borrowings
Current portion of long-term borrowings
Accounts payable - other,
Income taxes payable
Contract liabilities
Other

The current first halfof the fiscal year
(As of March 31, 2023)

1,068,638－
751,780
1,221,218
19,2362,356,643
968,835

1,112,491
9,025
751,780
1,202,101
772,133
2,079,528
1,201,092

Total current liabilities

6,386,353

7,128,151

Non-current liabilities
Long-term borrowings
Retirement benefit liability
Other

3,178,010
1,816,159
7,432

2,802,120
1,889,671
7,005

5,001,601

4,698,797

Total liabilities

Total non-current liabilities

11,387,955

11,826,949

Net assets
Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares

5,218,512
6,768,841
5,224,287(3,257,237)

5,232,078
6,769,335
4,458,031(3,230,813)

13,954,404

13,228,632

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans

75,55489,490(53,931)108,31265,344(52,582)

Total accumulated other comprehensive income

111,114

121,074

Subscription rights to shares
Non-controlling interests

110,774
3,701,436

107,751
3,594,841

Total net assets

17,877,729

17,052,300

29,265,684

28,879,249

Total shareholders' equity

Total liabilities and net assets-6-

（2） Quarterly consolidated statement of income and quarterly consolidated statementof comprehensive income
Quarterly consolidated statement of income
For the first half
(Unit: thousands of yen)
For the first halfof the previous fiscal year
(from October 1, 2021
to March 31, 2022)

For the first halfof the current fiscal year
(from October 1, 2022
to March 31, 2023)

Net sales
Cost of sales

12,975,547
3,814,933

13,631,385
4,481,114

Gross profit

9,160,614

9,150,271

Selling, general and administrative expenses

8,561,400

9,168,836

599,214(18,565)

65
23,86752－－

174,973

29,07860,38453,011

235,409

2,892

6,135

329,690－－－
26,842

7,734
7,903
7,936

359,425

29,710Ordinary income

292,800

187,134

Extraordinary income
Gain on sale of shares of subsidiaries and associates
Gain on change in equity

12,41776,481－
139,53188,898

139,531

10,240
909
3,240
－
4,700

4,105
10,546
13,4507,148－

Total extraordinary losses

19,08935,251

Income before income taxes

Operating income
Non-operating income
Interest income
Foreign exchange gains
Share of profit of entities accounted for using equity
methodOther
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodForeign exchange losses
Commission expenses
Other
Total non-operating expenses

Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets
Impairment losses
Loss on sale of investment securities
Loss on valuation of investment securities
Loss on step acquisitions

362,608

291,414

Income taxes-current

7,705

703,393

Income taxes-deferred

351,151(10,956)

Total income taxes

358,856

692,436

3,752(401,022)(119,577)
123,329(74,862)

Profit (loss)
Profit (loss) attributable to non-controlling interests
Profit (loss) attributable to owners of parent-7-(326,160)

Quarterly consolidated statement of comprehensive income
For the first half
(Unit: thousands of yen)
For the first halfof the previous fiscal year
(from October 1, 2021
to March 31, 2022)

Profit (loss)
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income

For the first halfof the current fiscal year
(from October 1, 2022
to March 31, 2023)

3,752(401,022)(20,628)
35,342(1,435)(1,857)(24,879)
1,348

30,51235,34843,791

9,960

Comprehensive income

47,543(391,062)(Comprehensive income attributable to)Comprehensive income attributable to ownersof parent
Comprehensive income attributable to non-controllinginterests

166,511(316,199)(118,968)(74,862)-8-

（3） Quarterly consolidated statement of cash flows
For the first half ofthe current fiscal year
(from October 1, 2021
to March 31, 2022)
Cash flows from operating activities
Income before income taxes
Depreciation
Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in retirement benefit liability
Interest and dividend income
Interest expenses
Share of loss (profit) of entities accounted for using equity
methodLoss (gain) on step acquisitions
Loss (gain) on change in equity
Loss on retirement of non-current assets
Loss (gain) on valuation of investment securities
Loss (gain) on sale of investment securities
Decrease (increase) in trade receivables
Increase (decrease) in trade payables
Increase (decrease) in accounts payable-other
Increase/decrease in consumption taxes payable/consumption
taxes refund receivable
Other, net(Unit: thousands of yen)
For the first half ofthe current fiscal year
(from October 1, 2022
to March 31, 2023)

362,608
694,660
909
109,4252,564
65,785(65)
2,892

291,414672,354
10,546
136,177(1,282)
74,142(52)
6,135

329,690(174,973)

4,700(76,481)
10,240－(9,176)
191,422(91,303)(15,307)－(139,531)
4,105
7,148
13,450(222,549)
48,174(51,997)(481,879)

1,057,174

26,608(74,319)

Subtotal

1,127,293

1,656,119Interest and dividends income received
Interest paid
Income taxes refund (paid)

62(2,892)(1,912,569)

52(6,135)455,911(788,106)

2,105,948(39,979)(1,336,048)
16,196(44,500)(36,079)(583,419)
1,504－(29,000)－

14,014

－

5,417

1,629

(1,413,899)(616,364)

Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Proceeds from sales of investment securities
Payments for acquisition of businesses
Purchase of shares of subsidiaries resulting in change in scopeof consolidation
Proceeds from purchase of shares of subsidiaries resulting inchange in scope of consolidation
Other, net
Net cash provided by (used in) investing activities-9-For the first half ofthe current fiscal year
(from October 1, 2021
to March 31, 2022)
Cash flows from financing activities
Proceeds from short-term borrowings
Repayments of short-term borrowings
Repayments of long-term borrowings
Proceeds from issuance of shares
Proceeds from share issuance to non-controlling shareholders
Dividends paid
Dividends paid to non-controlling interests
Purchase of shares of subsidiaries not resulting in change inscope of consolidation
Purchase of treasury shares of subsidiaries
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents－(439,609)－

60,000(50,975)(375,890)
27,132(2,940)(440,095)(2,940)(85,400)(12,500)(29,800)(776,489)－(798,208)

29,113(25,385)(2,949,381)

665,988

Cash and cash equivalents at beginning of period

15,540,084

12,097,658

Cash and cash equivalents at end of period

12,590,702

12,763,647- 10 -

204－(250,545)
28,660(Unit: thousands of yen)
For the first half ofthe current fiscal year
(from October 1, 2022
to March 31, 2023)

4) Notes concerning quarterly consolidated financial statements(Notes concerning going concern assumption)
Not applicable.
(Notes in the event of significant changes in shareholders’ equity)
Not applicable.
(Segment information, etc.)【Segment information】
Ⅰ First half of previous fiscal year (period from October 1, 2021 to March 31, 2022)
1. Information on net sales, profit or loss for each reporting segment and revenue breakdown information
Reporting segment
Content
business

Healthcare
business

School DX
business

8,952,620

1,845,506

11,039

Revenue from contracts
with customers(Unit: thousands of yen)Amountreported on the
Adjustment
quarterly
amountconsolidated(Note)1
statement ofincome(Note)2

Otherbusiness

Total

121,247

1,561,974

12,481,349－

12,481,349

30,383－452,775

494,198－

494,198

8,963,659

1,875,890

121,247

2,014,750

12,975,547－

12,975,547

Sales to outside customers

8,963,659

1,875,890

121,247

2,014,750

12,975,547－

12,975,547

Internal sales between
segments or transfers

112,459

9,571－

523,974

646,005(646,005)

－

Total

9,076,118

1,885,461

121,247

2,538,724

13,621,552(646,005)

12,975,547

2,857,409(648,681)(232,956)(176,321)

1,799,449(1,200,235)

599,214

Net salesGoodsorservicestransferred at a point in
time
Goods
or
servicestransferred over time

Segment income (loss)(Note) 1. The segment income (loss) adjustment of ¥(1,200,235) thousand includes the elimination of inter-segment transactionsof ¥(16,918) thousand and corporate expenses not allocated to each reporting segment of ¥(1,183,316) thousand.
Corporate expenses are composed largely of general and administrative expenses not attributed to any reporting
segment.
2. The segment income (loss) represents the result of adjustment to operating income reported on the quarterly
consolidated statement of income.

2. Information on impairment loss on non-current assets or goodwill and others for each reporting segment(Important impairment losses related to fixed assets)
Reporting segment
Content
business
Impairment loss－

Healthcare
business

School DX
business

－

－

Other
business
909

Total

909

(Unit: thousands of yen)Amountreported on the
Adjustment
quarterly
amountconsolidated(Note)1
statement ofincome(Note)2－

909(Material change in goodwill)
In addition, in other business, goodwill of ¥149,142 thousand was recorded for the first six months of the
fiscal year under review as a result of the acquisition of additional shares of AI Infinity Co., Ltd., which madethe company a consolidated subsidiary.
- 11 -Ⅱ First half of previous fiscal year (period from October 1, 2022 to March 31, 2022)
1. Information on net sales, profit or loss for each reporting segment and revenue breakdown information
Reporting segment
Content
business

Healthcare
business

School DX
business

9,371,278

2,165,938

42,424

Revenue from contracts
with customers(Unit: thousands of yen)Amountreported on the
Adjustment
quarterly
amountconsolidated(Note)1
statement ofincome(Note)2

Otherbusiness

Total

309,264

1,368,068

13,214,550－

13,214,550

24,212－

350,197

416,834－

416,834

9,413,703

2,190,151

309,264

1,718,266

13,631,385－

13,631,385

Sales to outside customers

9,413,703

2,190,151

309,264

1,718,266

13,631,385－

13,631,385

Internal sales between
segments or transfers

88,987

5,431－

698,911

793,330(793,330)

－

Total

9,502,690

2,195,582

309,264

2,417,178

14,424,715(793,330)

13,631,385

2,794,644(219,897)(461,465)(807,100)

1,306,180(1,324,745)(18,565)

Net salesGoodsorservicestransferred at a point in
time
Goods
or
servicestransferred over time

Segment income (loss)(Note) 1. The segment income (loss) adjustment of ¥(1,324,745) thousand includes the elimination of inter-segment transactionsof ¥9,178 thousand and corporate expenses not allocated to each reporting segment of ¥(1,333,924) thousand.
Corporate expenses are composed largely of general and administrative expenses not attributed to any reporting
segment.
2. The segment income (loss) represents the result of adjustment to operating income reported on the quarterly
consolidated statement of income.

2. Information on impairment loss on non-current assets or goodwill and others for each reporting segment(Important impairment losses related to fixed assets)
Reporting segment
Content
business
Impairment loss－

Healthcare
business

School DX
business

1,992

－

Other
business
8,554

Total

10,546(Unit: thousands of yen)Amountreported on the
Adjustment
quarterly
amountconsolidated(Note)1
statement ofincome(Note)2－

10,546

3. Matters regarding change in reporting segments and others
Due to the increased importance of the school DX business operated by its consolidated subsidiary, Motivation
Works Inc., the internal management classification was reviewed, and as a result, the reporting segments werechanged from the previous three segments of "Content business," "Healthcare business," and "Other business"
to four segments of "Content business," "Healthcare business," "School DX business," and "Other business"from the first quarter of the current fiscal year.
The segment information for the first half of the previous fiscal year is based on the new segments after thechange.

- 12 -