Summary of First Half Business Results for the Fiscal Year Ending February 28, 2023
[Japan GAAP] (Consolidated)
October 11, 2022
Company
Tokyo Individualized Educational Institute, Inc.
Listed on the TSE Prime
Stock Code4745
URL https://www.tkg-jp.com/en/ir/
Representative
Katsuki Saito, President and Representative Director
Contact
Takeharu Tsutsumi, Director
Tel: +81 3 6911 3216
Expected submission date of the 1H report:
October 12, 2022
Expected date of dividend payment:
November 15, 2022
Preparation of 1H supplementary financial document:Yes
1H results briefing:
Yes (For analysts/institutional investors)(Rounded down to million yen)

1. First half consolidated business results for the fiscal year ending February 2023
(March 1, 2022 through August 31, 2022)(1) Consolidated results of operations(% change from the previous corresponding period)

Net sales

Operating income

Net income
attributable toparent company

Ordinary income

million yen%

million yen%

million yen%

million yen%

1H, Fiscal year ending
February 2023

10,472(3.8)

71(89.7)

74(89.4)

88(79.4)

1H, Fiscal year ended
February 2022

10,890

33.0

695

−

699

−

427

−

Note: Comprehensive income
1H, Fiscal year ending February 2023:
1H, Fiscal year ended February 2022:

89 million yen (-79.2%)
428 million yen (-%)

Net income
per share

Diluted net income
per share
Yen

Yen

1H, Fiscal year ending
February 2023

1.62

−

1H, Fiscal year ended
February 2022

7.88

−

(2) Consolidated financial position
Total assets

Net assets

Shareholder’s equity
ratio

million yen

million yen%

1H, Fiscal year ending
February 2023

11,337

7,999

70.4

Fiscal year ended
February 2022

12,679

8,616

67.8

Reference: Shareholders’ equity:
1H, Fiscal year ending February 2023 7,982 million yen
Fiscal year ended February 2022 8,600 million yen

2. Dividends
Full-year dividend
End of 1Q

End of 2Q

End of 3Q

Year-end

Full year

yen

yen

yen

yen

yen

Fiscal year ended
February 2022

−

13.00

−

13.00

26.00

Fiscal year ending
February 2023

−

13.00
−

13.00

26.00

Fiscal year ending
February 2023 (forecast)
Note: Revisions to the most recent dividend forecast: None

3. Forecast of consolidated business results for fiscal year ending February 2023
(March 1, 2022 through February 28, 2023)(% change from the previous corresponding period)

OperatingincomeNet sales
million yen

Fiscal year ending
February 2023

23,858

Ordinary income

Net income
attributable toparent company

Net income
per share% million yen%

million yen%

million yen

%

Yen

6.1

9.8

2,633

9.6

1,687

6.9

31.08

2,632

Note: Revisions to the most recent performance forecast: None

* Notes(1)

Transfer of important subsidiaries during the current quarterly cumulative consolidated accounting period: None(2)

Adoption of special accounting treatments for quarterly consolidated financial statements: None

(3)

Changes in accounting policies, accounting estimates and restatement
1) Changes in accounting policies associated with the revision of accounting standards, etc.: Yes
2) Changes in accounting policies other than 1): None
3) Changes in accounting estimates: None
4) Restatement: None(4)

Shares outstanding (common stock)1) Number of shares outstanding at theend of period (treasury stock included)2) Treasury stock at the end of period
3) Average number of shares during
period (quarterly cumulative total)

1H, fiscal year
ending February
2023

54,291,435 sharesFiscal year
ended February
2022

54,291,435 shares

1H, fiscal year
ending February2023

136 sharesFiscal year
ended February2022

136 shares

1H, fiscal year
ending February
2023

54,291,299 shares

1H, fiscal year
ended February
2022

54,291,299 shares* Quarterly financial statements are not subject to audits by certified public accountants or audit corporations.
* Explanation regarding appropriate use of business forecasts and other special instructions
Forecasts regarding future performance in this material are based on information currently available to the Company
and certain assumptions that the Company deems to be reasonable at the time this report was prepared, and are notintended as a guarantee that the Company will achieve these targets. Further, actual results may differ significantly
from the forecasts due to various factors. For notes in using earnings projections and assumptions for premises
thereof, refer to page 4 of the Attachment “1. Qualitative Information on Quarterly Results (3) Explanation of theForecast of Consolidated Business Results and other Future Forecasts.
(Note on obtaining supplementary materials to quarterly financial statements)
Supplementary materials to quarterly financial statements (fact sheet) will be provided on the Company’s website from
October 11, 2022.

Contents of Attachment

1. Qualitative Information on Quarterly Results ........................................................................................... 2(1)

Explanation of Operating Results ................................................................................................... 2(2)

Explanation of Financial Standing ................................................................................................... 3(3)

Explanation of the Forecast of Consolidated Business Results and other Future Forecasts .......... 4

2. Quarterly Consolidated Financial Statements and Main Notes ............................................................... 5(1)

Quarterly Consolidated Balance Sheets ......................................................................................... 5(2)

Quarterly Consolidated Statements of Operations and Quarterly Statement ofComprehensive Income .................................................................................................................. 6(3)

Quarterly Consolidated Cash Flow Statements .............................................................................. 8(4)

Notes Concerning Quarterly Consolidated Financial Statements ................................................... 9(Notes on Quarterly Consolidated Income Statements) .................................................................. 9(Notes Regarding the Company as a Going Concern).................................................................... 9(Notes on Significant Changes in the Amount of Shareholders’ Equity) .......................................... 9(Changes in Accounting Policies).................................................................................................... 9(Additional Information) ................................................................................................................. 10(Segment Information, etc.) .......................................................................................................... 10

3. Other Notes ........................................................................................................................................... 11
Circumstances Concerning Orders Received, Sales, and Production................................................... 11- 1 -1. Qualitative Information on Quarterly Results(1) Explanation of Operating Results
Information related to future events in the text are based on judgments made by the Company at the end of thequarterly consolidated accounting period.
While the Japanese economic outlook for the first half of the fiscal year ending February 2023 is showing signs of a
gradual recovery, continued caution is needed due to the risk of an economic slowdown both in Japan and abroad
driven by monetary tightening across the globe, coupled with the impact of price increases on households. Further,
the situation concerning the impact of COVID-19 remains unpredictable, with the further spread of the omicron
variant continuing to progress at a rapid pace.
With regard to the education system in Japan, Japan's new school curriculum guidelines for middle schools were
implemented across the board in FY2021, and the new school curriculum guidelines for high schools were
implemented beginning in FY2022. This transition in the education system has further accelerated the shift to online
learning, which was already in high demand as a result of COVID-19, and has increased the need for digitallearning materials that facilitate the effective learning of curriculum subjects, and has diversified the entrance exam
system. The prep school market also needs to adopt a flexible, rapid response to these changes, and is faced withintensifying competition between participants, including new entrants from other industries.
Amidst these circumstances, we have looked to provide teaching services closely aligned to individual customer
needs based on our core corporate philosophy: The confidence that you can do it if you try; The joy of taking on a
new challenge; The importance of having dreams - With these three educational ideals and hospitality as thelinchpin of our corporate activities, we shall contribute to a happy future for humanity.
During the first half of the fiscal year ending February 2023, we were impacted by the new variant strain of thenovel coronavirus, omicron. We work to manage classrooms while prioritizing the safety and security of students
and employees alike above all else by ensuring that infectious disease control measures were stringently followed.
To help our students achieve their learning goals, we have focused on improving the quality of our educational
services through human resource development, and the introduction of curriculum focused on achieving results.
Our competitive advantage is in our “business of ‘Creating Shared Value’ with university students”, a businessprocess that serves as the foundation for our business activities. A key initiative under this arm of our business isthe TEACHERS’ SUMMIT Annual Class Plan, which is continually being improved upon.
In terms of human resources development for improving the quality of our educational services, we held training
seminars from August through to September covering know-how on “coaching” skills and other dialogue-based
communication skills to all school employees, and all teachers providing individualized teaching services, totalingsome 12,800 participants in all. This is aimed at bolstering our teachers’ instructional capabilities to aid in student
growth as students capable of “self-learning” through dialogues that motivate students, and improve theirunderstanding of the subject matter. At the same time, we look to facilitate the growth of university student teachers
by providing opportunities for them to acquire skills that also serve a practical purpose in wider society.
In terms of school expansion, we continued to look to open dominant schools focused primarily on metropolitan
centers as part of efforts to bolster the strength of our brand in regional areas to further expand the business. In
June 2022, we opened two Tokyo Individualized Educational Institute schools (TIEI) in Tokyo, the Ikegami School
and the Kagurazaka School. Further, in October we will open a new TIEI school in Ebina (Kanagawa).

- 2 -With regard to student recruitment, the extended impact of the omicron strain of COVID-19, behavioral changes inhigh school students associated with changes to university entrance exams, and a drop in student recruitment
inflows from prep school comparison websites have served to blunt student inquiries, and the average number ofenrolled students for the 1H of the fiscal year ending February 2023 was 31,695 (down 1.2 % year-on-year).
In online education services, we will continue with strategy restructuring efforts to ensure we are playing to ourstrengths. As part of these efforts, as of August 30 we stopped taking new customer inquiries for our 1online
business for online individualized teaching, which had been initiated on a trial basis.
Due to the above, results for the first half of the fiscal year ending February 2023 saw a year-on-year decline in net
sales of 417 million yen (3.8%) to end at 10,472 million yen resulting from the decline in student enrollments. In
terms of operating income, while efforts to streamline teacher class placements have begun to bear fruit, reduced
earnings as a result of a reduction in revenues and an increase in depreciation and amortization expenses
pertaining to the redevelopment of the student placement system, and the corresponding increase in operating andmaintenance costs have led to operating income falling to 71 million yen, a 623 million yen (89.7%) reduction yearon-year. Likewise, ordinary income dropped 625 million yen (89.4%) year-on-year to end at 74 million yen.
Quarterly net income attributable to owners of the parent company was 88 million yen, a decline of 339 million yen(79.4%) year-on-year.
Further, the main line of business for our Group is the individualized teaching business. Net sales, segment profit,and other totals have been omitted for other business lines as these represent a small fraction of total earnings.

(2) Explanation of Financial Standing
1) Assets, Liabilities, and Net Assets[Assets]
Total assets at the end of the first half of the current fiscal year were 11,337 million yen, a 1,342 million yen(10.6%) decline from the end of the previous fiscal year.
Current assets were at 6,705 million yen, a 1,451 million yen (17.8%) decline from the end of the previous fiscal
year. This decline was despite an increase in accounts receivable of 839 million yen and inventories of 11 million
yen, and was primarily driven by a decline of 2,286 million yen in cash and deposits, and a further 16 million yen
decline in “other” assets.
Tangible fixed assets were 815 million yen, a 11 million yen (1.5%) increase from the end of the previous fiscal
year. This increase was primarily due to capital investments for opening new schools and expanding classrooms
at existing schools.
Intangible fixed assets were 1,859 million yen, a 130 million yen (7.5%) increase from the end of the previous
fiscal year. This increase was primarily due to capital investments in development of a student placement system
and a billing platform system.
Investments and other assets were 1,957 million yen, a 32 million yen (1.6%) decline from the end of the previous
fiscal year. Despite an increase in the security deposit for new school openings of 3 million yen, this decline wasprimarily the result of a 36 million drop in “other” investments and assets.

- 3 -[Liabilities]
Total liabilities at the end of the first half of the current fiscal year were 3,337 million yen, a 725 million yen(17.9%) decline from the end of the previous fiscal year. While there was an increase of 390 million yen in
accrued expenses and 500 million yen in contractual liabilities, this decline was primarily the result of a decline of
703 million yen in accrued tax payable, etc., 832 million yen in “other” liabilities, and a decrease of 79 million yen
in the reserve for shareholder benefits.
[Net assets]
Net assets at the end of the first half of the current fiscal year were 7,999 million yen, a 616 million yen (7.2%)
decline from the end of the previous fiscal year. This decline was the result of surplus dividend payments of 705
million yen, and quarterly net income attributable to owners of the parent company totaling 88 million yen.
2) Cash Flows
Cash and cash equivalents at the end of the first half of the current fiscal year (hereafter, “Cash”) were 4,816 million
yen, a decline of 2,286 million yen from the end of the previous consolidated fiscal year. The status of each type ofcash flow and the main factors involved are described below.
[Cash flow from operating activities
Cash used in operating activities during the first half of the current fiscal year was 1,157 million yen (60 million
yen in cash expenditures during the first half of the previous fiscal year). This was primarily the results of 185
million yen in depreciation and amortization expenses, an increase in contractual liabilities of 500 million yen, an
increase in accounts receivable of 839 million yen, a decrease in consumption tax payable of 386 million yen, and613 million yen in income taxes, etc. paid.
When compared to the previous corresponding period, while there was a decline in accounts receivable of 239
million yen, the decline in income before income taxes of 628 million yen and consumption tax payable of 407
million yen, and an increase in income taxes, etc. paid of 398 million yen resulted in an increase in cash used inoperating activities of 1,096 million yen.
[Cash flow from investing activities
Cash used in investing activities during the first half of the current fiscal year was 424 million yen (493 million yen
in cash expenditures during the first half of the previous fiscal year). This mainly resulted from expenditures of 96
million yen for acquisition of tangible fixed assets for opening new schools, 31 million yen in expenditures forlease and guarantee deposits, 279 million yen in expenditures for acquisition of intangible fixed assets for building
a student placement system and billing platform system, and 18 million yen in expenditures for acquisition of longterm prepaid expenses.
When compared to the previous corresponding period, expenditures for acquisition of tangible fixed assets of 14
million yen and expenditures for acquisition of intangible fixed assets of 54 million yen resulted in a decline of 69
million yen in cash used in investing activities.
[Cash flow from financing activities
Cash used in financing activities during the first half of the current fiscal year was 704 million yen (705 million yen
in cash expenditures during the first half of the previous fiscal year). This resulted from the payment dividends.

(3) Explanation of the Forecast of Consolidated Business Results and other Future Forecasts
With regard to the forecast of consolidated business results for the term ending February 2023, there have been nochanges to the forecast of consolidated business results announced for the full year in the Summary of BusinessResults for the Fiscal Year Ended February 28, 2022 [Japan GAAP] (Consolidated) disclosed April 12, 2022.

- 4 -2. Quarterly Consolidated Financial Statements and Main Notes(1) Quarterly Consolidated Balance Sheets(Unit: Thousands of yen)
End of previous
consolidated fiscal year
(As of February 28, 2022)

End of the first half of thecurrent consolidated
fiscal year
(As of August 31, 2022)

7,103,309
586,225
35,574441,027(9,057)
8,157,080

4,816,580
1,425,851
46,966424,863(9,045)
6,705,215

803,179

815,031

184,000
1,545,628
1,729,628

173,777
1,686,000
1,859,778

1,601,797
388,225
1,990,022
4,522,831
12,679,911

1,605,602
351,627
1,957,230
4,632,039
11,337,255

8,357
864,273823,548859,611116,244
20,79086,842
1,256,728
4,036,397

14,813
1,255,102
119,681
1,360,124
132,736−7,426
423,886
3,313,772

26,852
26,852
4,063,249

23,541
23,541
3,337,313

642,157
1,013,565
6,944,447(121)
8,600,048
16,6138,616,662
12,679,911

642,157
1,013,565
6,326,699(121)
7,982,301
17,6407,999,941
11,337,255

AssetsCurrent assets
Cash and deposits
Accounts receivable
Inventories
Other
Allowances for bad debts
Total current assets
Fixed assets
Tangible fixed assets
Intangible fixed assets
Goodwill
Other
Total intangible fixed assets
Investments and other assets
Lease and guarantee deposits
Other
Total investments and other assets
Total fixed assets
Total assets
Liabilities
Current liabilities
Accounts payable
Accrued expenses
Accrued tax payable, etc.
Contractual liabilities
Reserve for bonuses
Reserve for officer bonuses
Reserve for shareholder benefits
Other
Total current liabilities
Fixed liabilities
Other
Total fixed liabilities
Total liabilities
Net assets
Shareholder's equity
CapitalCapital surplus
Retained earnings
Treasury stock
Total shareholder's equity
Minority interest
Total net assets
Total liabilities and net assets- 5 -(2) Quarterly Consolidated Statements of Operations and Quarterly Statement of Comprehensive Income
Quarterly Consolidated Income Statements
First half of consolidated fiscal year
(Unit: Thousands of yen)
1H, fiscal year ended
February 2022
(March 1, 2021
to August 31, 2021)
Net sales
Cost of goods sold
Gross profit
Selling, general and administrative expenses
Operating income
Non-operating income
Interest income
Gain on disposal of unpaid dividends
Subsidy income
Gain on bad debts recovered
Other
Total non-operating income
Ordinary income
Extraordinary loss
Impairment losses
Total extraordinary loss
Quarterly income before income taxes
Corporate income, inhabitant and enterprise taxes
Adjustment of corporate taxes, etc.
Total accrued tax payable
Quarterly net income
Quarterly net income attributable to minority interests
Quarterly net income attributable to owners of the parent
company- 6 -1H, fiscal year ending
February 2023
(March 1, 2022
to August 31, 2022)

10,890,074
7,079,590
3,810,483
3,114,931
695,552

10,472,112
6,974,860
3,497,252
3,425,326
71,926

1
339
1,400
2,104
48
3,894
699,447

1
247
285
1,890
12
2,437
74,363−−
699,447
250,624
20,088
270,712428,734801* 3,532
3,532
70,830(59,373)
41,137(18,235)
89,066
1,027

427,933

88,039

Quarterly statement of comprehensive income
Second quarter consolidated cumulative period(Unit: Thousands of yen)
1H, fiscal year ended
February 2022
(March 1, 2021
to August 31, 2021)
Quarterly net income
Quarterly comprehensive income(Breakdown)
Quarterly comprehensive income attributable toowners of the parent company
Quarterly comprehensive income attributable tominority interests- 7 -1H, fiscal year ending
February 2023
(March 1, 2022
to August 31, 2022)

428,734
428,734

89,06689,066427,933

88,039

801

1,027

(3)

Quarterly Consolidated Cash Flow Statements(Unit: Thousands of yen)
1H, fiscal year ended
February 2022
(March 1, 2021
to August 31, 2021)

Cash flow from operating activities
Income before income taxes
Depreciation and amortization expenses
Goodwill amortization
Impairment losses
Amortization of long-term prepaid expenses
Subsidy income
Increase (Decrease) in allowances for bad debts
Increase (Decrease) in reserve for bonuses
Increase (Decrease) in reserve for officer bonuses
Increase (Decrease) in reserve for shareholder
benefits
Interest and dividends received
Gain on disposal of unpaid dividends
Decrease (Increase) in accounts receivable
Decrease (Increase) in inventories
Decrease (Increase) in other current liabilities
Increase (Decrease) in accounts payable
Increase (Decrease) in contractual liabilities
Increase (Decrease) in consumption tax payable,
etc.
Decrease (Increase) in consumption tax receivable,
etc.
Increase (Decrease) in other current liabilities
SubtotalInterest and dividend income received
Subsidies received
Income taxes, etc. paid
Cash flow from operating activities
Cash flow from investing activities
Expenditures for acquisition of tangible fixed assets
Expenditures for acquisition of intangible fixed
assetsExpenditures for lease and guarantee deposits
Income from refund of lease and guarantee deposits
Expenditures for acquisition of long-term prepaid
expenses
Cash flow from investing activities
Cash flow from financing activities
Dividends paid
Cash flow from financing activities
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 8 -1H, fiscal year ending
February 2023
(March 1, 2022
to August 31, 2022)

699,447
94,696
10,222－
31,926(1,400)219
12,772−

70,830185,020
10,222
3,532
32,476(285)(12)
16,492(20,790)(54,645)(79,416)(1)(339)(1,078,973)(5,627)(32,101)
4,929
497,046(1)(247)(839,625)(11,392)
24,171
6,455
500,512

20,447(386,703)

1,195

−

(46,770)
153,0441
1,400(215,422)(60,975)(55,375)(544,134)
1
285(613,518)(1,157,365)(110,989)(96,628)(333,896)(279,199)(33,764)
3,095(31,519)
1,102(18,258)(18,167)(493,814)(424,442)(705,680)(705,680)(1,260,470)
6,562,644
5,302,173(704,921)(704,921)(2,286,729)
7,103,309
4,816,580

(4) Notes Concerning Quarterly Consolidated Financial Statements(Notes on Quarterly Consolidated Income Statements)* Impairment losses
1H, fiscal year ended February 2022 (March 1, 2021 to August 31, 2021)
Not applicable
1H, fiscal year ending February 2023 (March 1, 2022 to August 31, 2022)
The Company recorded an impairment loss for the first half of the current fiscal year.
Application
Business asset

Type

Location

Building

Breakdown(thousands of yen)

Fukuoka City, Fukuoka

3,532

The Group groups schools – the smallest cash flow producing units. Individual assets are used as the grouping
unit for unemployed capital.
As the Company stopped accepting new customer inquiries for the 1online business for online individualizedteaching service as of August 30, the recoverable amount for this service was determined to be zero, and its
entire book value was written off as an impairment loss.
(Notes Regarding the Company as a Going Concern)
Not applicable(Notes on Significant Changes in the Amount of Shareholders’ Equity)
Not applicable(Changes in Accounting Policies)(Application of the Accounting Standard for Revenue Recognition)
The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, dated March 31, 2020) wasapplied from the beginning of the first quarter of the fiscal year ending February 2023. Under this change,
monetary amounts expected to be received in exchange for goods and services are recognized as revenue atthe moment control of the promised goods and services is transferred to the customer.
While the Accounting Standard for Revenue Recognition has been applied in accordance with the provisions ontransitional handling prescribed in the provision to paragraph 84 of the Accounting Standard for Revenue
Recognition, said application does not affect the balance of retained earnings at the beginning of the firstquarter of the fiscal year ending February 2023. Further, this change does not affect profit and loss statements
for the first half of the fiscal year ending February 2023.
With the application of the Accounting Standard for Revenue Recognition, “advances received”, which had
previously been listed under “other” in “current liabilities” in the consolidated balance sheet for the previous
consolidated fiscal year, is now included in “contractual liabilities”. Further, “Increase (Decrease) in advances
received” presented under “Cash flow from operating activities” in the Quarterly Consolidated Cash Flow
Statements for preceding periods is presented as “Increase (Decrease) in contractual liabilities” from the firsthalf of the current fiscal year.

- 9 -(Application of the Accounting Standard for Fair Value Measurement)
The Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, dated July 4, 2019) wasapplied from the beginning of the first quarter of the fiscal year ending February 2023. The new accounting
standards prescribed by the Accounting Standard for Fair Value Measurement shall be applied prospectively inaccordance with the provisions on transitional handling prescribed in the provision to paragraph 19 of the
Accounting Standard for Fair Value Measurement and paragraph 44-2 of the Accounting Standard for Financial
Instruments (ASBJ Statement No. 10, dated July 4, 2019). Further, said changes shall have no effect onquarterly consolidated financial statements.
(Additional Information)
In the current fiscal year the Company made accounting estimates for impaired assets, including goodwill andother fixed assets, and the retrievability of deferred tax assets based on the assumption that the novel
coronavirus pandemic would not pose a significant impact. However, there remains the potential for future losses
should the above supposition fail to materialize.
(Segment Information, etc.)[Segment Information]
The main line of business for our Group is the individualized teaching business. Net sales, segment profit, andother totals have been omitted for other business lines as these represent a small fraction of total earnings.

- 10 -

3. Other Notes
Circumstances Concerning Orders Received, Sales, and Production(1)

Production and orders received
The Group is primarily involved with providing classes to students, and does not record production and orders
received.

(2)

Sales
Sales performance by segment for the 1H, fiscal year ending
February 2023 is as follows:

Segment name

1H, fiscal year ending
February 2023
Net sales(thousands of yen)

Composition ratio(%)

Year-on-year comparison(%)

Individualized teaching
Primary school students

1,154,413

11.0

101.9

Middle school students

3,538,892

33.8

98.7

High school students

5,564,077

53.1

93.3

10,257,383

97.9

96.0

214,729

2.1

104.6

10,472,112

100.0

96.2

Total individualized teaching
Other business total
Total(Note)

Other business activities include science labs, writing classes, online individualized learning, and corporate
human resource development activities provided by HRBC Co., Ltd.

- 11 -