UNOFFICIAL TRANSLATION
The formal official document is in Japanese

Summary of Consolidated Financial Results for the First Quarter of
Fiscal Year Ending September 30, 2024 (Japanese Accounting Standards)

February 7, 2024
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): February 14, 2024
Scheduled date of dividend payment: –Supplementary documents for quarterly results: Yes
Quarterly results briefing (Japanese): Yes (for securities analysts and institutional investors (on demand))(Figures less than one millions of yen are omitted)

1. Consolidated business results for the three months ended December 31, 2023
(October 1, 2023– December 31, 2023)(Percentages represent year-on-year changes)(1) Consolidated operating results (cumulative total)
Net salesFirst quarter of fiscal year ending
September 30, 2024
First quarter of fiscal year ended
September 30, 2023
(Note) Comprehensive income:Operating income

Millions of yen% Millions of yen

6,625

(6.6)

435

Profit attributable toowners of parent

Ordinary income% Millions of yen% Millions of yen

%

–

–

630

–

(590)

–

792

7,091
8.2
(61)
–
(88)
–
Three months ended December 31, 2023: 621 millions of yen –%Three months ended December 31, 2022: (639) millions of yen –%Net income
per share
YenFirst quarter of fiscal year ending
September 30, 2024
First quarter of fiscal year ended
September 30, 2023

Net income
per share/diluted

Yen

11.49

–

(10.77)–(2) Consolidated financial position
Total assets

Net assets

Millions of yen

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

Equity ratio

Millions of yen%

27,937
17,621
29,155
17,583As of December 31, 2023: 13,937 millions of yen
As of September 30, 2023: 13,953 millions of yen

49.9
47.9

2. Dividends
End of firstquarter
Fiscal year ended
September 30, 2023
Fiscal year ending
September 30, 2024
Fiscal year ending
September 30, 2024 (forecast)End of second
quarter

Dividend per share
End of third
quarterYear end

Annual

Yen

Yen

Yen

Yen

Yen

–

8.00

–

8.00

16.00

8.00

–

8.00

16.00

–

(Note) Revision of dividend forecast for during this period : No

3. Forecast for consolidated business results for the fiscal year ending September 30, 2024
(October 1, 2023 – September 30, 2024)
Net sales
For the first half
Full year(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 ofyen%Millions of yen%

Yen

13,00027,000

(4.6)
0.8

600
1,000

–
235.1

1,000
1,400

434.4
205.4

700
800

–
6.2

12.76
14.58

(Note) Revisions to forecasts for consolidated business results published most recently: Yes

* Notes(1) Important changes of subsidiaries during the term (changes in specified subsidiaries resulting in change in scopeof 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):12/2023: 61,264,600 shares
09/2023: 61,264,600 shares(ii) Number of treasury shares at the end of period
12/2023: 6,405,973 shares
09/2023: 6,405,973 shares(iii) Average number of shares during the period (quarterly consolidated cumulative period)
Three months ended 12/2023: 54,858,627 shares Three months ended 12/2022: 54,810,804 shares* This Summary of Consolidated Financial Results for the First Quarter is not included in the scope of quarterly review
by certified public accountants or audit corporations.
* 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 quarter 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 quarterly 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 statements ............................................................................................................. 5(1) Quarterly consolidated balance sheet .............................................................................................................. 5(2) Quarterly consolidated statements of income and quarterly consolidated statements of comprehensive
income ............................................................................................................................................................. 7(3) Notes concerning quarterly consolidated financial statements ....................................................................... 9(Notes concerning going concern assumption) .............................................................................................. 9(Note on significant fluctuations in shareholder equity) ............................................................................ 9(Segment information, etc.) .......................................................................................................................................... 91

1.Qualitative information on financial results for the current quarterly settlement(1) Explanation on operating results
Overview of the first quarter of fiscal year ending September 30, 2024
(Period from October 1, 2023 to December 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 current fiscal year under review, consolidated net sales stood at ¥6,625 million (down 6.6% year
on year), attributable to the absence of non-recurring sales of videos posted at Video Market Corporation, a
consolidated subsidiary, in the same period of the previous year.
Gross profit came to ¥4,836 million (up 6.2% year on year), reflecting a significant reduction in the cost of
sales due to the absence of non-recurring purchases of videos posted at Video Market Corporation in the yearago period and a decrease in loss-making DX support projects for corporate customers.
Operating income amounted to ¥435 million (compared to an operating loss of ¥61 million in the same periodof the previous year) due to the increase in gross profit and a reduction in selling, general and administrative(SG&A) expenses mainly resulting from a decrease in personnel expenses and outsourcing expenses.
Ordinary income increased significantly to ¥792 million (compared to an ordinary loss of ¥88 million in thesame period of the previous year) due to the rise in operating income and a share of profit of entities accounted
for using equity method of ¥409 million (compared to a share of loss of entities accounted for using equity
method of ¥34 million), which was attributable to extraordinary income (gain on sale of non-current assets)
posted at Shobunsha Holdings, Inc., an equity-method affiliate.
Profit attributable to owners of parent rose significantly to ¥630 million (compared to a loss of ¥590 million),chiefly due to the increase in ordinary income and the absence of a loss caused in the same period of theprevious year by 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 for the income taxrelated treatment of a gain on the transfer of shares, associated with the transfer of some of the shares in
Boshimo Ltd., a consolidated subsidiary, to MTI Healthcare Holdings Inc., a consolidated subsidiary.
Consolidated business results(Period from October 1, 2023 to December 31, 2023)
First quarter
First quarterof the fiscal year ending of the fiscal year ended
September 30, 2024
September 30, 2023

ChangeAmountPercentage

Millions of yen

Millions of yen

Millions of yen%

Net sales

6,625

7,091

(465)

(6.6)

Cost of sales

1,788

2,538

(750)

(29.6)

Gross profit

4,836

4,552

+284

+6.2

SG&A

4,401

4,613

(212)

(4.6)

Operating profit (loss)

435

(61)

+496

－

Ordinary profit (loss)
Profit (loss) attributable toowners of parent

792

(88)

+881

－

630

(590)

+1,220－

Breakdown of SG&A
(Period from October 1, 2023 to December 31, 2023)
First quarter
First quarterof the fiscal year ending of the fiscal year ended
September 30, 2024
September 30, 2023

ChangeAmountPercentage

Millions of yen

Millions of yen

Millions of yen

%

4,401

4,613

(212)

(4.6)

Advertising expenses

626

479

+147

+30.8

Personnel expenses

1,818

1,989

(170)

(8.6)

Commission fee

709

746

(37)

(5.0)

Subcontract expenses

441

560

(119)

(21.3)

Depreciation

318

289

+28

+10.0

Other

486

549

(62)

(11.4)

Total

2

Operating results by segment are as follows.
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 3.09 million of paying subscribers. The figure was 40 thousand smaller than at theend of September 2023. The number of paying subscribers was nearly level, reflecting an increase in thenumber of paying subscribers to the “AdGuard” security-related app.
Net sales totaled ¥4,210 million (down 17.7% year on year) due to the absence of non-recurring sales ofvideos posted at Video Market Corporation, a consolidated subsidiary, in the same period of the previous
year.
Operating income was ¥1,091 million (down 24.1% 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, the maternal health record book app and the childcare DX service.
This segment served 540 thousand of paying subscribers. The figure was 10 thousand smaller than at theend of September 2023. On the other hand, the number of pharmacies that offer the cloud drug record
service came to 1,923 at the end of December 2023 (up 130 from the end of September 2023), as the resultof great efforts focused on increasing the number of pharmacies whose motivation to introduce such service
is growing.
Net sales came to ¥1,260 million (up 24.6% year on year), given expanded sales of Cloud drug record
service and Childcare DX service, etc. Operating income significantly increased to ¥112 million (loss of¥172 million in the previous fiscal year) due to the effect of increased sales and implemented 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 ¥260 million (up 67.5% year on year) due to an increase in monthly usage feesfrom educational institutions that have introduced the “BLEND” cloud-based school business support
system. “BLEND” has been used by 566 educational institutions since April 2023 (226 institutions morethan a year ago). The operating loss was reduced to ¥82 million (compared to a loss of ¥246 million in thesame period of the previous year) due to the significant rise in net sales and a reduction in outsourcing
expenses associated with a reduction in development expense.
④ Other business
Other business includes the B2B AI business operated by Automagi Inc.,
Net sales stood at ¥1,282 million (up 7.8% year on year) due to an increase in orders in the corporate DX
support business. The operating loss was reduced to ¥87 million (loss of ¥393 million in the previous year),primarily reflecting a reduction in cost of sales due to a significant decrease in loss-making DX support
projects for corporate customers.

(2) Explanation on financial position
At the end of the first quarter under review, total assets decreased ¥218 million from the end of September
2023, to ¥27,937 million.
Regarding the assets, the current assets increased ¥137 million, mainly due to a rise in cash and deposits.
Non-current assets fell ¥122 million primarily due to decreases in goodwill and customer-related assets,
despite an increase in software.
Current assets decreased ¥1,565 million mainly due to a fall in cash and deposits. Non-current assets
rose ¥347 million chiefly due to an increase in investment securities, which more than offset a decrease ingoodwill and customer-related assets.
Current liabilities decreased ¥1,109 million, mainly reflecting falls in income taxes payable and contract
liabilities. Non-current liabilities fell ¥146 million chiefly due to a decline in long-term borrowings.
Net assets increased ¥37 million, mainly reflecting the posting of ¥630 million as profit attributable toowners of parent, which offset dividends paid.
3(3) Explanation of future forecast information including consolidated forecast
The Company will work hard to expand sales and turn a profit in the healthcare business, which is expected
to be a driving force for future performance growth. In the content business, it will make every effort toincrease the number of paying subscribers by expanding sales of the “AdGuard” security-related app andstriving 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, the Group isearnestly working to increase the number of schools that will introduce this system beginning in April 2024.
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.
The consolidated results forecasts for the first half of the fiscal year ending September 30, 2024, and the fullyear have been revised as stated in the Notice of Revisions to First-Half and Full-Year Consolidated Results
Forecasts announced on February 7, 2024.
[Assumptions for forecast values]
The impact of undetermined new businesses and low-probability mergers and acquisitions in the Group are
not taken into account and are not incorporated in the forecast figures. The Company will promptly disclose
any deviation between forecasts and results that should be disclosed.
Earnings forecast for the first half of the fiscal year ending September 30, 2024
(Period from October 1, 2023 to March 31, 2024)
Consolidated
Net sales(Millions of yen)

YoY(%)

13,000(4.6)

Operating profit

600(loss of ¥18 million in theprevious fiscal year)

Ordinary profit

1,000+434.4

Profit attributable toowners of parent

700(loss of ¥326 million in theprevious fiscal year)

Earnings forecast for the fiscal year ending September 30, 2024
(Period from October 1, 2023 to September 30, 2024)
Consolidated(Millions of yen)

YoY(%)Net sales

27,000+0.8

Operating profit

1,000+235.1

Ordinary profit
Profit attributable toowners of parent

1,400+205.4

800

+6.2

4

2. Quarterly consolidated financial statements（1） Quarterly consolidated balance sheet（Unit: thousands of yen）
Previous fiscal year
(As of September 30, 2023)

Current fiscal year
(As of December 31, 2023)

AssetsCurrent assets
Cash and deposits

13,720,915

12,109,063

Notes and accounts receivable-trade, and contract assets

4,197,136

4,185,321

Other

1,056,294

1,115,390

Allowance for doubtful accounts(33,941)(34,732)

18,940,404

17,375,044

213,711

203,983

Software1,894,135

1,917,427

Goodwill

240,012

190,746

Customer-related assets

491,400

386,100

Other

230,614245,7932,856,162

2,740,067

4,081,380

4,444,745

305,268

297,8702,658,854

2,833,306

Other

110,361

52,951

Allowance for doubtful accounts(10,704)(10,704)

Total investment and other assets

7,145,160

7,618,169

10,215,035

10,562,220

29,155,439

27,937,264

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, 2023)

Liabilities
Current liabilities
Account payable-trade
Current portion of long-term borrowings
Accounts payable - other,
Income taxes payable
Contract liabilities
Provision for bonuses
Other1,023,077
747,600
1,279,759
637,6192,567,914

Current fiscal year
(As of December 31, 2023)－
1,074,790

1,012,862
744,030
1,323,120
59,8082,327,717
202,781551,260

Total current liabilities

7,330,762

6,221,580

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

2,431,250
1,786,153
23,4492,246,875
1,814,641
32,508

Total non-current liabilities

4,240,853

4,094,024

Total non-current liabilities

11,571,615

10,315,605

5,232,677
6,485,816
5,143,458(3,230,813)

5,232,677
6,322,902
5,333,475(3,230,813)

13,631,139

13,658,241

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

165,132
97,84859,594

136,387
84,446
57,959Total accumulated other comprehensive income

322,575

278,793

Subscription rights to shares
Non-controlling interests

59,1473,570,962

58,325
3,626,299

Total net assets

17,583,824

17,621,659

29,155,439

27,937,264

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

Total liabilities and net assets

6

（2） Quarterly consolidated statements of income and quarterly consolidated statementof comprehensive income
Quarterly consolidated statement of income
For the first quarter(Unit: thousands of yen)
For the first quarterof the previous fiscal year
(from October 1, 2022
to December 31, 2022)

For the first quarterof the current fiscal year
(from October 1, 2023
to December 31, 2023)

Net sales
Cost of sales

7,091,062
2,538,631

6,625,132
1,788,321

Gross profit

4,552,430

4,836,810

Selling, general and administrative expenses

4,613,844

4,401,353

Operating profit (loss)(61,414)435,457

19
6,811

17

－

409,440

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
methodOther investment loss
Other
Total non-operating expenses－

17,204

5,985

24,035415,443

3,030

2,287

34,190－－14,131

48,395
7,717

51,35258,400Ordinary profit (loss)(88,730)

792,500

Extraordinary losses
Loss on retirement of non-current assets
Loss on sale of investment securities
Loss on valuation of investment securities

743
13,4508,049－
17,337

Total extraordinary losses－
14,194

Profit (loss) before income taxes(102,925)

767,112

Income taxes-current
Income taxes-deferred

510,494
34,384

275,818(173,707)

Total income taxes

544,879

102,110

Profit (loss)(647,804)

665,001

Loss attributable to non-controlling interests(57,587)

34,522

Profit (loss) attributable to owners of parent(590,217)

630,479

7

25,387

Quarterly consolidated statement of comprehensive income
For the first quarter(Unit: thousands of yen)
For the first quarterof the previous fiscal year
(from October 1, 2022
to December 31, 2022)

For the first quarterof the current fiscal year
(from October 1, 2023
to December 31, 2023)

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(647,804)

665,001257(32,517)674(616)(13,629)(1,634)

39,466(27,901)

7,880(43,782)

Comprehensive income

639,923

621,219(Comprehensive income attributable to)Comprehensive income attributable to ownersof parent
Comprehensive income attributable to non-controllinginterests(582,336)

586,697

57,58734,5228

3) Notes concerning quarterly consolidated financial statements(Notes concerning going concern assumption)
Not applicable.
(Note on significant fluctuations in shareholder equity)
Not applicable.
(Segment information, etc.)【Segment information】
Ⅰ First Quarter of Previous Fiscal Year (Period from October 1, 2022 to December 31, 2022)
1. Information on net sales, profit or loss for each reporting segment and revenue breakdown information
Reporting segment
Content
business

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

Healthcare
business

School DX
business

5,042,451

995,112

155,485

713,758

6,906,808－

6,906,808

10,606

12,877－

160,770

184,254－

184,254

Revenue from contracts
with customers

5,053,057

1,007,989

155,485

874,529

7,091,062－

7,091,062

Sales to outside customers

5,053,057

1,007,989

155,485

874,529

7,091,062－

7,091,062

Internal sales between
segments or transfers

65,412

3,366－

315,556

384,335(384,335)

－

Total

5,118,469

1,011,355

155,485

1,190,086

7,475,397(384,335)

7,091,062

1,439,217(172,968)(246,850)(393,372)

626,025(687,439)(61,414)Total

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

Segment income (loss)(Note) 1. The segment income (loss) adjustment of -¥687,439 thousand includes the elimination of inter-segment transactionsof -¥8,459 thousand and corporate expenses not allocated to each reporting segment of -¥678,979 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
Not applicable.

9Ⅱ First Quarter of Current Fiscal Year(Period from October 1, 2023 to December 31, 2023)
1. Information on net sales, profit or loss for each reporting segment and revenue breakdown information
Reporting segment
Other
business(Unit: thousands of yen)Amountreported on the
Adjustment
quarterly
amountconsolidated(Note)1
statement ofincome(Note)2

Content
business

Healthcare
business

School DX
business

4,159,302

1,247,476

238,068

865,994

6,510,841－

6,510,841

14,545

10,35022,442

66,952

114,290－

114,290

Revenue from contracts
with customers

4,173,847

1,257,826

260,511

932,947

6,625,132－

6,625,132

Sales to outside customers

4,173,847

1,257,826

260,511

932,947

6,625,132－

6,625,132

Internal sales between
segments or transfers

36,8152,369－

349,961

389,146(389,146)

－

Total

4,210,663

1,260,196

260,511

1,282,908

7,014,279(389,146)

6,625,132

1,091,942

112,860(82,353)(87,318)

1,035,131(599,673)

435,457

Total

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

Segment income (loss)(Note) 1. The segment income (loss) adjustment of -¥599,673 thousand includes the elimination of inter-segment transactionsof ¥9,370 thousand and corporate expenses not allocated to each reporting segment of -¥609,044 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
Not applicable.

10