FY2016-1Q
Financial Results Briefing

D.A.Consortium Inc.
August 5, 2016

Table of Contents

 Overview of Financial Results（Consolidated/Non-consolidated）

 Business Trends
 Key Measures-1©2016 D.A.Consortium All rights reservedOverview of Consolidated
Financial Results-2©2016 D.A.Consortium All rights reserved

Financial Highlights (Consolidated)（Millions of Yen）

FY2016-1Q（Apr. 2016 to Jun. 2016）

Y on YSales

38,547

121.7%

Gross Profit

5,225

120.5%

Operating Income803

117.5%

Profit Attributable toOwners of Parent97

31.4%

EBITDA

1,035

116.1%

Operating Margin*

15.4%△0.4pt*Operating Margin＝Operating Income / Gross Profit-３©2016 D.A.Consortium All rights reserved

FY2016 Business Forecast 1Q Progress（Millions of Yen）

FY2016（Apr. 2016 to Mar. 2017）
Forecast

ProgressRate

1Q Results

170,000

38,547

22.7%

Operating Income

5,100803

15.8%

Ordinary Income

5,000593

11.6%

Profit Attributable toOwners of Parent

2,10097

4.6%

Net Income per Share43.24－－Sales-４©2016 D.A.Consortium All rights reservedQuarterly Sales（Consolidated）（Millions of Yen）

-5©2016 D.A.Consortium All rights reservedIncrease Factor of Sales (Year on Year)（Millions of Yen）

UNITED+1,142

irep+6,272

DAC△3,827
Elimination ofinternaltransactions andothers

38,547+3,284

31,674+6.87 Billions of Yen+21.7％FY2015-1Q

FY2016-1Q-6©2016 D.A.Consortium All rights reservedQuarterly Gross Profit（Consolidated）（Millions of Yen）

-7©2016 D.A.Consortium All rights reserved

Results by Domain (Consolidated)
FY2015-1Q（Apr. 2015 to Jun. 2015）

FY2016-1Q（Apr. 2016 to Jun. 2016）

Sales%

Y on Y

99.0

37,862

98.2

120.6

28,96891.4

34,665

89.9

119.7

Media and DAS Domain2,929

9.2

3,428

8.9

117.0

Adjustment between Domains

△499

△1.6

△231

△0.6-308

1.0

685

1.8

222.5

31,706100.0

38,547100.0

121.6%

Y on YSales
Internet-related Business
Agent Domain

Investment Business
TOTAL

Gross Profit
Internet-related Business

Sales

%

31,398(Millions of Yen)

Gross Profit(Millions of Yen)

(Millions of Yen)%

Gross Profit(Millions of Yen)

（％）

（％）

4,040

93.2

4,600

88.0

113.9

Agent Domain

2,854

65.8

3,514

67.3

123.1

Media and DAS Domain

1,243

28.7

1,145

21.9

92.2

Adjustment between Domains△57△1.3△59△1.1-294

6.8

625

12.0

212.3

4,335

100.0

5,225

100.0

120.5

Investment BusinessTOTAL-8©2016 D.A.Consortium All rights reserved

Sales to HDY Group and Others (Consolidated)

FY2015-1Q

FY2016-1Q（Apr. 2015 to Jun. 2015）

Sales（Millions of Yen）

Share（％）（Apr. 2016 to Jun. 2016）

Share

Sales

（％）

（Millions of Yen）

Y on Y（％）

Hakuhodo DY Group

15,741

49.7

18,103

47.0

115.0

Others15,93350.3

20,444

53.0

128.3

TOTAL

31,674100.0

38,547

100.0

121.7

-9©2016 D.A.Consortium All rights reservedSales to HDY Group and Others (Consolidated)（％ / Millions of Yen）

-10©2016 D.A.Consortium All rights reservedQuarterly SG&A Expenses (Consolidated)（Millions of Yen）

Number of Employees*2,081*Total number of directors, employees, temporary employees, etc.

2,337
-11©2016 D.A.Consortium All rights reservedQuarterly Operating Income（Consolidated）（Millions of Yen）

-12©2016 D.A.Consortium All rights reservedQuarterly EBITDA（Consolidated）（Millions of Yen）

*EBITDA＝Operating Profit + Depreciation + Amortization of goodwill-13©2016 D.A.Consortium All rights reserved

Balance Sheets（Consolidated）
FY2015（As of Mar.31, 2015）

Amount（Millions of Yen）

Current Assets
Non-current Assets
Total Assets
Current Liabilities
Non-current Liabilities
Total Liabilities
Shareholders’ Equity
Non-controlling Interests
OthersTotal Net Assets
Total Liabilities and Net Assets

43,765
10,48754,252FY2016-1Q（As of Jun.30, 2015）

Amount%（Millions of Yen）

80.7
19.3

100.0

27,562
1,252

50.8

28,814
14,388
8,507

53.1

2,541
25,43754,252

4.7

2.3
26.5
15.7

46.9
100.0

38,734
11,41250,146Comparisons
（％）

%

77.2

88.5

22.8108.8

100.0

92.4

24,551
1,911

49.0

89.1

3.8

152.6

26,462
13,943
8,165

52.8

91.8

27.8

96.9

16.3

96.0

1,574
23,68450,146

3.2

61.9

47.2

93.1

100.0

92.4

-14©2016 D.A.Consortium All rights reserved

Statements of Cash Flows（Consolidated）（Millions of Yen）

FY2016-1Q（Apr. 2016 to Jun. 2016）

Cash flows from operating activities

1,718

Cash flows from investing activities

1,364

Cash flows from financing activities

286

Effect of exchange rate change on cash andcash equivalents△135Net increase (decrease) in cash and cash equivalents

3,234

Cash and cash equivalents at beginning of period

12,642

Cash and cash equivalents at end of period

15,877-15©2016 D.A.Consortium All rights reservedOverview of Non-consolidated
Financial Results-16©2016 D.A.Consortium All rights reserved

Financial Highlights (Non-consolidated)（Millions of Yen）

FY2016-1Q(Apr. 2016 to Jun. 2016)

Y on YSales

22,131117.4%

Gross Profit

2,347

130.9%

Operating Income

396

87.7%

Net Income

945

137.1%

16.9%△8.3ptOperating Margin**Operating Margin＝Operating Income / Gross Profit-17©2016 D.A.Consortium All rights reservedQuarterly Sales & Gross Profit（Non-consolidated）（Millions of Yen）

Sales

（Millions of Yen）

Gross Profit-18©2016 D.A.Consortium All rights reserved

Results by Service（Non-consolidated）
FY2015-1Q（Apr. 2015 to Jun. 2015）

Amount%18,064

Technology Service
Investment &Operation Service

Sales
Media Service

TOTAL

FY2016-1Q（Apr. 2016 to Jun. 2016）

Y on Y

Amount%95.8

21,150

95.6

117.1

509

2.7

398

1.8

78.1

272

1.4

582

2.6

213.7

18,846100.0

22,131

100.0

117.4

（Millions of Yen）

Amount（Millions of Yen）

Amount（％）

Y on YGross Profit（Millions of Yen）

Media Service

1,308

73.0

1,572

67.0

120.2

Technology Service

228

12.8

224

9.5

98.2

Investment &Operation Service

256

14.3

550

23.4

214.9

1,793

100.0

2,347

100.0

130.9

TOTAL%（Millions of Yen）%（％）

-19©2016 D.A.Consortium All rights reserved

Business Trends-20©2016 D.A.Consortium All rights reserved

Sales breakdown by Ad Format（Non-consolidated）

FY2015-1Q（Apr. 2015 to Jun. 2015）

Amount%13,463

Video Ad
Others

FY2016-1Q（Apr. 2016 to Jun. 2016）

Y on Y

Amount%74.5

15,282

72.3

113.5

1,698

9.4

2,625

12.4

154.6

11,76565.1

12,657

59.8

107.6

Search

3,061

16.9

4,359

20.6

142.4

Affiliate / Reward

1,272

7.0

1,350

6.4

106.2

267

1.5

157

0.7

58.9

18,064100.0

21,150

100.0

117.1

（Millions of Yen）

Display

OthersTOTAL（Millions of Yen）（％）

-21©2016 D.A.Consortium All rights reservedQuarterly Sales by Ad Format（Non-consolidated/Media Service）（Millions of Yen）

-22©2016 D.A.Consortium All rights reserved

Premium Media Ad Sales（Non-consolidated/Media Service）
FY2015

15,374 Mil.¥FY2014

7,488 Mil.¥FY20133,589 Mil.¥-23©2016 D.A.Consortium All rights reservedVideo Ad Sales（Non-consolidated/Media Service）（Millions of Yen）

FY20159,924 Mil.¥FY2014

4,252 Mil.¥FY2013

1,735 Mil.¥-24©2016 D.A.Consortium All rights reservedQuarterly Sales by Client Industry（Non-consolidated/Media Service）-25©2016 D.A.Consortium All rights reservedQuarterly Trend of Top100 Advertisers（Non-consolidated/Media Service）
 Quarterly Sales to Top100 Advertisers（Millionsof Yen）

 Number of Our Clientsin Top100 Advertisers（Companies）*Top100Advertisers : By Nikkei Advertising Research Institute「AD SPENDING OF LEADING JAPANESE CORPORATIONS」-26©2016 D.A.Consortium All rights reservedQuarterly Sales of Smart Device Ads（Consolidated）（Millions of Yen）

-27©2016 D.A.Consortium All rights reservedQuarterly Sales of Programmatic Ads（Consolidated）（Millions of Yen）

-28©2016 D.A.Consortium All rights reserved

Summary of Consolidated Subsidiaries’ Results（Y on Y）

Sales
IREP Co., Ltd.

Agent

DAS

UNITED, Inc.

Agent

Media

HAKUHODO i-studio Inc.

DAS

Platform One Inc.

DASADPRO inc.

Agent

Operating
IncomeAgentTorchlight Inc.

Agent

DAS

D.A.Consortium Beijing CO., LTD.
DAC ASIA PTE. LTD.

Agent

Agent-29©2016 D.A.Consortium All rights reservedConsolidated/Non-consolidated Ratio
FY2014-1Q
FY2015-1Q（4/2014～6/2014） （4/2015～6/2015）

FY2016-1Q（4/2016～6/2016）

8.0

6.77

7.0
6.0
5.0
4.0
3.0
2.0

1.91

1.68 1.74

1.51

2.02

1.0

1.23

0.78

0.55

0.0

Sales

Operating Income

Ordinary Income-30©2016 D.A.Consortium All rights reserved

Appendix-31©2016 D.A.Consortium All rights reserved

Business Domains of DAC Group

Agent Domain
Dealing with Media and
Ad Agencies

DAC Taiwan

DAS Domain

Media Domain

Providing technologies,

Providing services tocreative and solutions

consumers-32©2016 D.A.Consortium All rights reserved

Business Model of DAC GroupMedia Representative and Digital Solutions
Buying and selling ad space

Operation Service

Outsourcing businessTechnology ServiceR&D

Solution development/provisioning
Social media marketing

SEM services

Progress management

Trading Desk

RTB

Users

Ad Agencies

Advertisers

CreativeDevelopment

Online Publishers

Media Service

Ad Network
DMP
GlobalDAC Taiwan-33©2016 D.A.Consortium All rights reserved

DAC’s Core Business “Media Representative”

Advertisers

Ad Agency
Selling
Ad Spaces

Hakuhodo DY
Media Partners Inc.

Media Rep.

BuyingAd Spaces

OnlinePublishers
Yahoo! JAPANLINETOKYU AGENCY INC.
Nikkeisha, Inc.
I&S BBDO Inc.
Asahi Advertising Inc.

Providing
Ad Technologies

CyberAgent, Inc
McCann Erickson
Japan Inc.
SEPTENI CO.,LTD.
etc.

ProvidingOperation service

Over 500
Companies

Consortium

DAC was established as a consortium ofleading ad agencies,
headed by Hakuhodo DY Group<Core Operations＞• Buying Ad Spaces• Media Planning• Progress Management• Consulting• Development Technologies• Operation Service＋Google
Facebook

Providing
Ad Technologies

YouTubeTwitter
NIKKEI.com
MSN

ProvidingOperation Serviceetc.

Over 1,000
Companies

Media Representative
Providing total support foronline advertising-34©2016 D.A.Consortium All rights reservedAd technology lineup of DAC GroupMedia Planning System

Ad Trading Platform

Ad ServerDMP

DSP

Programmatic AdPublishers

Advertisers/Ad Agencies

Message Management Tool

SSP-35©2016 D.A.Consortium All rights reservedConsolidated Subsidiaries（As of June,2016）Name

DAC TaiwanOwnership

Business

IREP Co., Ltd. TSE 2nd

57.6%

Digital marketing including performance-based ad focused on listing
ads, search engine optimization, content marketing and web analytics.

UNITED, Inc.

44.4%

Smartphone applications and advertising technology business.

HAKUHODO i-studio Inc.

60.0%

Production, system development and CRM services for the entire
online advertising field.

Platform One Inc.

100.0%

Providing platforms for online advertising trading.

ADPRO inc.

100.0%

Operational services for online advertising, including schedulemanagement, sending ad data and placement confirmation.

Torchlight Inc.

70.0%

Services supporting the utilization of social media including owned
media and ad.

D.A.Consortium BeijingCO., LTD.

50.1%

Online advertising business in China.

D.A.CONSORTIUM
TAIWAN INC.

100.0%

Online advertising business in Taiwan.

DAC ASIA PTE. LTD.

100.0%

Supports online advertising strategy, business development, market
research and the expansion of group companies in the Southeast
Asian region.

I-DAC PTE. LTD.

80.0%

Comprehensive digital marketing solution in the Southeast Asianregion.

Mothers-36©2016 D.A.Consortium All rights reserved

Equity-method Affiliates（As of June,2016）
NameOwnership

Business18.5%

Web integration service, social media marketing service, and support
service of digital marketing.

spicebox, inc.

34.4%

Marketing and consultation services for digital communications
design.

Adinnovation Inc.

18.0%

Marketing business for smartphones, ad tracking tool business forsmartphones, media consulting business.

Babycome, inc.

38.2%

Operating "Babycome": one of the largest parenting site in Japanand "Babytube": parenting related movies site.

livepass Inc.

22.4%

Next generation personal video marketing platform company.

Innity Corporation
BerhadBursa Malaysia

25.1%

Online advertising trading platform and advertising network in theSoutheast Asian region.

GLIDER associates, INC.

15.7%

Planning and administration of curation magazine “antenna*”.

Members Co., Ltd.

TSE 2ndNSE 2nd-37©2016 D.A.Consortium All rights reserved

Other companies in which DAC invests（As of June,2016）
NameBusiness

Digital Catapult Inc.

Provides digital content-serving and creative services for PC and mobile.

Data Stadium Inc.

Sports data contents and related solutions.

Video ResearchInteractive Inc.

Internet audience measurements and provides ad servers.

O-uccino, Inc.

Ad agency, planning, creating, and operating real estate websites.

mediba Inc.

TSE 1stAs a mobile media representative, provides planning, organization and creation services.

YUMEMI Inc.

Mobile-related planning, development, operation and consultation services.

Co-Core Inc.

Operating the 3-D visual space website "meet-me“.

ALBERT Inc.

Mothers“Recommendation engine” developed in-house and advertising optimization solutions
using core analytical abilities.

Origami Inc.

Planning and administration of the next-generation e-commerce platform “Origami”.

Datasection Inc. Mothers

Online consumer and reputation analysis service.

Yummy Japan Inc.

YouTube channel management, web-based video production, web-based PR andadvertising.

Ubiregi Inc.

Ubiregi is an iPad POS(Point of Sales) Application and cloud based platform.

Handy Marketing Inc.

Marketing Solutions research, development, and analysis business.

ZEDO,Inc.

Developing ad server and video ad format for media companies.

IPONWEB Holdings
LimitedDevelopment of various ad technologies and cloud advertisement solution andconsulting service.
-38©2016 D.A.Consortium All rights reserved

Vision of DAC Group“The Axel”
This logo, called “the axel”, expresses the spirit
embodied in our brand slogan “Empoweringthe digital future” – the spirit to pioneer andimpart vitality into the future of digital society.

-39©2016 D.A.Consortium All rights reserved