Summary of Consolidated Business Results for the Fiscal Year Ended September 30, 2014
November 4, 2014
Listed Market: TSE

SEPTENI HOLDINGS CO., LTD.
Stock Code: 4293 URL: http://www.septeni-holdings.co.jp/en
Representative:
President and Representative Director Koki Sato
Contact Person:
IR and PR division Manager Eiichi Sou, Telephone: +81-3-6857-7258
Anticipated General Annual Shareholder Meeting Date: December 19, 2014
Anticipated Dividend Payment Date:
December 3, 2014
Anticipated Financial Report Filing Date:
December 19, 2014
Supplemental Earnings Presentation Materials:
Available
Earnings Presentation Meeting:
Held for institutional investors, analysts, media(All figures of less than 1 million yen are rounded down to the nearest digit)

1. Consolidated Earnings for the Fiscal Year Ended September 2014 (October 1, 2013 – September 30, 2014)(% figures represent year-over-year change)(1) Consolidated Earnings
Net Sales

Operating Income

Million Yen%

Ordinary Income%

Net Income%

Million Yen%

FY9/1454,345
18.2
2,259
41.8
2,362
34.8
FY9/1345,982
11.2
1,593
4.3
1,752
7.0
(Note) Comprehensive income: ¥1,738million in FY9/14 (38.9%); ¥1,251million in FY9/13 (63.1%)

1,549
1,207

28.3
78.3

EPS

Million Yen

Fully Diluted EPS
YenMillion Yen

ROE

ROA

Yen

Operating Margin%

FY9/14
61.22
59.54
18.5
FY9/13
47.90
46.56
17.2
(Reference) Minority shareholding income: ¥66 million in FY9/14; ¥100 million in FY9/13

%

%

12.6
11.5

4.2
3.5

(Note) The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. EPS and fully diluted EPS in FY9/13 are
calculated on the assumption that the stock split was implemented at the beginning of the previous fiscal year.

(2) Consolidated Financial Position
Total Assets

Net Assets

Million Yen

Net Asset Ratio

Book Value per Share

Million Yen%

Yen

FY9/14
21,625
10,203
FY9/1316,023
8,380(Reference) Capital: ¥9,177 million in FY9/14; ¥7,574 million in FY9/13

42.4
47.3

361.85300.26(Note) The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. Book value per share in FY9/13 is calculated on
the assumption that the stock split was implemented at the beginning of the previous fiscal year.

(3) Consolidated Cash Flow Conditions
Cash flow from operating
activities

Cash flow from investing
activities

Cash flow from financing
activities

Cash and Equivalents

Million Yen

Million Yen

Million Yen

Million Yen

2,830
1,094

-913
417

178
-85

8,687
6,570

FY9/14
FY9/13

2. Dividend Conditions
Dividends
End of 1Q
FY9/13
FY9/14
FY9/15 Estimate(Note) 1.

2.

―
―
―

End of 2Q

Yen

―
―
―

Yen

End of 3Q―――

Term-end

Yen

Total Value of
Dividends

Total

Dividend Payout
Ratio(Consolidated)

Dividend to Net
Asset Ratio(Consolidated)

Yen

Yen

Million Yen%%

1,400.00
9.00―

1,400.00
9.00
―

176
228

14.6
14.7

2.5
2.7

―

Estimates for dividends in the fiscal year ending September 30, 2015 have yet to be decided. For the dividend policy, please refer to “1.
Earnings Performance, Financial Conditions Analysis, (3) Basic Policy Regarding the Distribution of Profits, and Dividends in the Current
and Next Terms.”
The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. The figures for the fiscal year ended
September 30, 2013 are stated based on the number of shares before the stock split.

3. Earnings Estimates for the First Quarter of the Fiscal Year Ending September 30, 2015 (October 1, 2014 – December
31, 2014)
Net Sales
1st quarter(cumulative)(% figures represent year-over-year change)
Ordinary Income
Net Income
EPS

Operating Income

Million Yen%

Million Yen%

Million Yen%

Million Yen%

Yen

14,000

11.7

300

-56.1

300

-59.3

1,000

142.0

39.43

(Note) Instead of full-year earnings estimates, the Company discloses its earnings estimates for the next quarter. For details, please refer to “1.
Earnings Performance, Financial Conditions Analysis, (1) Earnings Performance Analysis” in this document.

* Annotation(1) Important changes in subsidiaries, including changes in the scope of consolidation: None
(2) Changes in accounting methods, procedures, presentation methods
Changes accompanying revisions in accounting standards:
None
Other changes in accounting methods:
None
Changes in accounting estimates:
None
Redisplay of revisions:
None(3) Shares issued (common stock)
Shares issued as of term-end (incl. Treasury stock): FY9/14
27,147,000 FY9/13
Treasury stock as of term-end:
FY9/14
1,784,600 FY9/13
Average number of shares outstanding:
FY9/1425,305,333 FY9/13

27,011,200
1,784,600
25,201,633(Note) The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. Shares issued as of term-end , treasury stock asof term-end and average number of shares outstanding in FY9/13 were calculated on the assumption that the stock split was implemented at
the beginning of the previous fiscal year.

(Reference) Non-Consolidated Earnings Overview
1. Non-Consolidated Earnings for the Fiscal Year Ended September 2014 (October 1, 2013 – September 30, 2014)(% figures represent year-over-year change)(1) Non-Consolidated Earnings
Net Sales
FY9/14
FY9/13Operating Income

Net Income%

Million Yen%

Million Yen%

Million Yen

%

2,521
1,908

32.1
24.3

1,105
659

67.6
61.8

1,163
694

67.6
80.8

1,267
136

826.0
- 44.4EPS
FY9/14
FY9/13

Ordinary Income

Million Yen

Fully Diluted EPS
Yen

Yen

50.10
5.43

48.72
5.28

(Note) The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. EPS and fully diluted EPS in FY9/13 are
calculated on the assumption that the stock split was implemented at the beginning of the previous fiscal year.

(2) Non-Consolidated Financial Position
Total Assets
Million Yen

FY9/14
FY9/13(Reference)

Net Assets

Net Asset Ratio

Book Value per Share

Million Yen

%

Yen

8,165
7,406
6,983
6,267
Capital: ¥ 7,376 million in FY9/14; ¥ 6,219 million in FY9/13

90.3
89.0

290.84
246.53(Note) The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. Book value per share in FY9/13 is calculated on
the assumption that the stock split was implemented at the beginning of the previous fiscal year.

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

Index

1. Earnings Performance, Financial Conditions Analysis ································································· 2(1) Earnings Performance Analysis ························································································· 2(2) Financial Conditions Analysis ··························································································· 3(3) Basic Policy Regarding the Distribution of Profits, and Dividends in the Current and Next Terms ··········· 5
2. Corporate Structure ··········································································································· 6
3. Management Policy ··········································································································· 7(1) Basic Corporate Management Policy ··················································································· 7(2) Medium- to Long-Term Corporate Strategy and Issues to Be Addressed ········································· 7
4. Consolidated Financial Statements ························································································· 8(1) Consolidated Balance Sheet ····························································································· 8(2) Consolidated Income Statement, Comprehensive Income Statement ············································· 10(3) Change in Consolidated Shareholders’ Equity Statement ·························································· 12(4) Consolidated Cash Flow Statement ···················································································· 14(5) Notes to Consolidated Financial Statements ·········································································· 16(Notes Regarding Going Concern Assumptions)········································································· 16[Business Segment Information] ······························································································ 16-1-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

1. Earnings Performance, Financial Conditions Analysis(1) Earnings Performance Analysis(Earnings Performance in the Current Term)
Looking at the Internet business environment in which the SEPTENI Group operates, the rapid proliferation ofsmartphones has continued, with the number of domestic contracts as of the end of September 2014 totaling 62.48 million,
which makes up 50.3% of the total number of mobile phone contracts (source: MM Research Institute). As such,smartphones are about to become a mainstream device for accessing the Internet and the market for smartphone
advertising and various services and content is expanding. In addition, the power of social media, led by SNS (social
networking services), has increased still further, and this is consequently prompting greater demand for marketing support
that makes use of the characteristics of social media. These changes in the operating environment have led to the Group
promoting the global expansion of its Internet business, with overseas business opportunities on the rise.
In this environment, the Group was able to expand its operations and increase profitability in its mainstay Internet
Marketing Business by promoting business operations with key businesses focused on “Mobile,” “Social,” and “Global.”
In addition, it proactively made upfront investments in human resources and new businesses, etc. to strengthen its futurecompetitiveness. As a result, sales and all profit categories set record highs for the third consecutive fiscal year, with net
sales increasing to ¥54,345 million (up 18.2% year on year), operating income rising to ¥2,259 million (up 41.8% year onyear), ordinary income advancing to ¥2,362 million (up 34.8% year on year) and net income climbing to ¥1,549 million(up 28.3% year on year) on a consolidated basis.
We discuss the business performance of each of our business segments below.

Internet Marketing BusinessIn the Internet Marketing Business, we provide comprehensive marketing support services to customers by leveraging thepower of the Internet. Specifically, we engage in sales of Internet advertising and provision of Web solutions (website
creation and operation, SEO services) in addition to in-house services including marketing platform operations for ad
networks and cloud-based CRM services.
During the current term, the segment was able to steadily expand its operations along with improving its profitability as aresult of success achieved by key businesses focused on “Mobile,” “Social,” and “Global.” Strong growth continued insmartphone advertising, with an upswing in sales by around 2.1 times year on year, as a result of stronger demand anddiversification of advertising products. In addition, the number of transactions handled by Group’s Social MediaBusiness, which centers on the Group’s strongpoint of marketing support services using Facebook, expanded
substantially by a factor of around 2.9, mainly as a result of an increase in the number of users and greater use ofsmartphones. Meanwhile, overseas business started to develop in earnest beginning this fiscal year, with operations
expanding significantly, centered on the base in North America. The Group pushed forward with establishing a businessfoundation toward exploring new markets, such as by newly setting up two overseas bases (London, Seoul) as well as
creating a subsidiary from a South Korean Internet advertising company (consolidated as of September 30, 2014).
As a result of these developments, net sales and operating income rose by 22.3% and 35.9% year on year, to ¥48,271
million and ¥2,740 million, respectively.

Media Content Business
The Media Content Business plans and develops digital content, including social games, primarily for smartphones,
and provides it to users through SNS, the application market, and other platforms. The business also develops andproduces Manga artists and distributes Manga works, aiming to plan and develop our own intellectual property.

During the current term, existing titles such as the browser game Legion of the Sky and the native application game
Traitorous Ciel Ark, which falls under the mobile game business operated by AXEL MARK INC., continued at a firmpace, but sales for this business declined year on year as a result of new titles being limited to one browser game. In
addition, as an upfront investment toward business expansion going forward, we proactively promoted the developmentof a native application game that is scheduled to be released in or after the fiscal year ending September 30, 2015.
Meanwhile, we began our full-fledged business expansion this fiscal year in the Manga Content Business, such as
starting GANMA!, an online distribution service for new serial Manga, in December last year, by proactively making
upfront investments in both cultivating Manga Artists and expanding the distribution service.

-2-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

As a result of the above, net sales came to ¥3,458 million (down 6.9% year on year) and operating loss ended at ¥277
million (compared with operating loss of ¥219 million in the previous term).

(Earnings Estimates for the Next Term)
For the term ending September 30, 2015, the Group aims to achieve growth in both sales and profits through sustainablegrowth in the Internet Marketing Business while continuing to make active investments aimed at creating highly
profitable businesses in the future.
With respect to the Internet Marketing Business, we will seek to expand operations and improve profitability with key
businesses focused on “Mobile,” “Social,” and “Global.”
Regarding the Mobile Game Business in the Media Content Business, we are aiming for improved profitability bycreating hit titles in native applications. As for the Manga Content Business, we plan to continue making active
investments toward expanding the scale of our platform.

(First Quarter Earnings Estimates)
The Company publishes its earnings estimates for the next quarter when it announces its quarterly results.
For the first quarter of the term ending September 30, 2015, we expect sales to increase, given that the businessperformance of our mainstay Internet Marketing Business remains firm, but operating income is expected to decline inpart due to a reaction to the temporary increase in gross income in the same period the previous fiscal year.
In the Media Content Business, although sales are expected to rise as a result of the release of new mobile game titles,
greater operating loss is anticipated on a year-on-year basis due to aggressive advance investments centered on gamedevelopment.
Meanwhile, all shares of a direct marketing subsidiary (in the “Other” business category) were transferred as of October
1 of this year and was excluded from consolidation starting in the first quarter. This transfer will be a factor behind a
decline in sales as well as operating income in the fiscal year ending September 30, 2015, while extraordinary income of¥1,098 million is expected to be posted as a gain on sales of the subsidiary’s stocks in the first quarter.
Given these circumstances, today the Company announced its earnings estimates for the first quarter of the fiscal year
ending September 30, 2015, as follows:

Earnings Estimates for the First Quarter of the Fiscal Year Ending September 30, 2015 (October 1, 2014 – December 31,
2014)
Net Sales
Operating Income
Ordinary Income
Net Income¥14,000 million¥300 million¥300 million¥1,000 million

The estimates stated above are our forecasts based on the information currently available, and contain uncertain elements
to a large extent. Actual earnings may differ from the above estimates due to various factors.
(2) Financial Condition Analysis
Assets, Liabilities, Net Asset Conditions(Assets)
Current assets grew by ¥4,612 million from the end of the previous term, to ¥18,115 million at the end of the current term
due to increases in cash and deposits and notes and accounts receivable-trade of ¥2,623 million and ¥1,828 million,
respectively.
Non-current assets increased by ¥989 million from the end of the previous term, to ¥3,510 million, mainly attributable toa ¥194 million rise in goodwill and an increase of ¥177 million in investment securities.
As a result of these changes, total assets rose by ¥5,602 million from the end of the previous term, to ¥21,625 million at
the end of the current term.

-3-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(Liabilities)
Current liabilities rose by ¥3,479 million from the end of the previous term, to ¥11,069 million at the end of the current
term, partly due to a ¥2,499 million and ¥516 million increase in accounts payable-trade and unpaid taxes, respectively.
Non-current liabilities rose by ¥300 million from the end of the previous term, to ¥352 million, primarily attributable to a¥297 million increase in long-term loans payable.
Consequently, total liabilities grew by ¥3,779 million, to ¥11,422 million over the same period.
(Net Assets)
Net assets grew by ¥1,822 million from the end of the previous term, to ¥10,203 million, partly due to inflow from net
income of ¥1,549 million, which offset ¥176 million in dividend payments.

Cash Flow Conditions
During the current fiscal year, cash and equivalents grew by ¥2,117 million from the end of the previous term, to ¥8,687
million.
We provide the details of our various cash flows for the current fiscal year below.
(Cash Flow from Operating Activities)
During the current fiscal year, we saw a net inflow of ¥2,830 million from operating activities, compared with a ¥1,094
million inflow in the previous term.
Factors contributing to this inflow included a ¥885 million increase in receivables, ¥980 million in corporate tax
payments, a ¥1,659 million increase in payables, and the realization of ¥2,316 million in net income before taxes.
(Cash Flow from Investing Activities)
A net cash outflow of ¥913 million was seen in investing activities, compared with an inflow of ¥417 million in theprevious term.
The main factors contributing to this net outflow included a ¥1,218 million outflow in the form of payments into time
deposits, an outflow of ¥258 million associated with acquiring shares of a subsidiary related to a change in the scope of
consolidation, which offset an inflow of ¥712 million from time deposits as well as proceeds of ¥190 million from thesale of investment securities.
(Cash Flow from Financing Activities)
In the current term, a net cash inflow of ¥178 million was recorded in financing activities, compared with an outflow of¥85 million in the previous term.
This inflow is attributed to income of ¥500 million from long-term loans payable, even though we incurred a repaymentof ¥127 million for long-term loans payable and a dividend payment of ¥176 million.

(Reference) Trends in Cash Flow-Related Indicators
FY9/10FY9/11

FY9/12

FY9/13

FY9/14

Net Asset Ratio (%)

45.3

48.6

45.0

47.3

42.4

Capital Adequacy Ratio, Market Capitalization Based (%)

43.6

42.8

62.0

139.5

149.3

Cash Flow to Interest-Bearing Debt Ratio (%)

122.0

155.5

73.7

77.9

42.8

Interest Coverage Ratio
66.2
46.5
116.6
180.0
Net Asset Ratio: Net Assets / Total Assets
Capital Adequacy Ratio: Market Capitalization / Total Assets
Cash Flow to Interest-Bearing Debt Ratio: Interest-Bearing Debt / Cash Flow from Operating Activities
Interest Coverage Ratio: Cash Flow from Operating Activities / Interest Payments
1. Each indicator is based on consolidated financial data.
2. Market capitalization is based on outstanding shares, excluding treasury stock.
3. Cash flow is based on cash flow from operating activities.
4. Interest-bearing debt includes all liabilities on our consolidated balance sheet that bear interest payments.

557.6

-4-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(3) Basic Policy Regarding the Distribution of Profits, and Dividends in the Current and Next Terms
We recognize that returning profits to our shareholders is a key management issue, and will flexibly implement the policy
outlined below regarding the appropriate distribution of profits.
With regard to the distribution of retained earnings, we will consider our consolidated earnings performance, the need tofortify our financial position, and the Group’s forward-looking business strategy while at the same time endeavoring tomaintain a dividend payout ratio of around 15%. Furthermore, we have established a minimum full-year dividend target
level of ¥5 per share, and seek to strike a balance between stable dividends and an appropriate level of profit distribution
to allow us to grow our earnings. In addition, we will endeavor to utilize our retained earnings for investments in training
personnel, optimizing and reinvigorating our existing businesses, and capturing new business areas that have the potential
for high growth and profitability.
Based on these policies, we expect to pay a ¥9 dividend per share during the current fiscal year.
Furthermore, with regard to dividends in the next term, we expect to implement a dividend in accordance with theabovementioned policy, and will announce the specific value for our dividend estimate as soon as we announce earnings
estimates for the full year.

-5-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

2. Corporate Structure
As of September 30, 2014, the SEPTENI Group comprises the holding company SEPTENI HOLDINGS, 24 consolidated
subsidiaries, and two equity accounting method held affiliates and is engaged in Internet marketing, media content, anddirect marketing businesses.
Below is description of businesses and a breakdown of the companies that belong to each of the Group’s businesssegments.
Business Segment

Business Description

Main Consolidated Subsidiaries

Internet Marketing

Internet advertising sales, Web solutions (website creation,
operation, SEO services), marketing platform operations forad networks, cloud-based CRM services, Internet marketing
support services for corporations

SEPTENI CO., LTD.
Tricorn Corporation

Media Content

Provision of digital content for smartphones centered ongames and cultivating and producing Manga Artists aimed atplanning and developing our own IP (intellectual property) as
well as operating a Manga distribution service, etc.

AXEL MARK INC.
COMICSMART INC.

Consigned sales promotion direct mailing, paper media
SEPTENI DIRECT
mailings
MARKETING CO., LTD. (Note)(Note) We transferred all our shareholdings and withdrew from the direct marketing business as of October 1, 2014.
Direct Marketing

SEPTENI’s Corporate Structure
Service,
Product
Provision

Capital Participation
Management Leadership,
SupervisionInternet Marketing Business
Internet Advertising Agency

SEPTENI CO., LTD.
Cloud-based CRM Services

SEPTENI HOLDINGS CO., LTD.

14 other companies

Media Content Business
Mobile content

AXEL MARK INC.
Manga content

COMICSMART INC.
5 other companies

Direct Marketing Business
SEPTENI DIRECT MARKETING CO., LTD.

-6-

Clients (Companies, Individual Users)

Tricorn Corporation

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

3. Management Policy(1) Basic Corporate Management Policy
As no important revisions have been made since the announcement of earnings for the fiscal year ended September 30,
2011, released on November 4, 2011, we have omitted our comments here. To review the earlier announcement, please
visit our home page: http://www.septeni-holdings.co.jp/en/.

(2) Medium- to Long-Term Corporate Strategy and Issues to be addressed
The Group intends to continue to accelerate its profit growth going forward, and has established a concept of “double
profits” in the midterm business policies that it has formulated in November 2013. The aim of these midterm business
policies is to further increase profits and improve the corporate value of the Group by creating a second mainstay
business along with Internet advertising, as well as by increasing the share of highly profitable businesses, whether theseare existing or new businesses. To that end, it regards “Mobile,” “Social,” and “Global” as its three business focuses, andwill work to further expand the Group’s operations and improve its profitability by strengthening its existing businesses
and promoting the development of new businesses mainly in these areas.

-7-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

4. Consolidated Financial Statements(1) Consolidated Balance Sheet(Unit: Thousand Yen)
Previous Term(Ended September 30, 2013)

Current Term(Ended September 30, 2014)

Cash and deposits

6,670,715

9,293,965

Notes and accounts receivable-trade

6,370,263

8,199,190

Unfinished products

16,93367,324

Stored goods

5,436

4,050

Deferred tax assets

135,495

197,171Other324,375

380,977

Doubtful account reserves-20,769-27,480

AssetsCurrent assets

Total current assets

13,502,450

18,115,200

Buildings, structures (net)156,720

112,284

Tools, furniture and fixtures (net)99,317

93,934Non-current assets
Property, plant and equipment

Other (net)

1,631

1,855

257,670

208,074

Goodwill

406,243

601,206

Software47,660269,780

Software in progress

222,413

25,113

1,335

1,335

677,652

897,435

Investment securities

964,609

1,141,908

Deposits and security deposits

569,625

646,850

Deferred tax assets

20,283

547,413

Other

31,31670,822

Total property, plant and equipment
Intangible assets

Other
Total intangible assets
Investments and other assets

Doubtful account reserves-278

Total investments and other assets
Total non-current assets
Total assets-8--1,918

1,585,556

2,405,076

2,520,879

3,510,586

16,023,329

21,625,786

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(Unit: Thousand Yen)
Previous Term(Ended September 30, 2013)

Current Term(Ended September 30, 2014)

Accounts payable-trade

5,069,836

7,569,396

Short-term loans payable

742,588730,002

Portion of long-term loans payable due within one year

99,996

175,001

Lease liabilities

1,488

245

Accounts payable-other244,563

343,499

Unpaid taxes

413,355

930,006

Bonus reserves

305,737

330,620

Other

712,835

991,070

7,590,401

11,069,841

8,345

305,568

Liabilities
Current liabilities

Total current liabilities
Non-current liabilities
Long-term loans payable

245

－

Other

44,026

47,113

Total non-current liabilities

52,617

352,681

7,643,019

11,422,523

Capital2,025,310

2,053,010

Capital reserves

3,120,395

3,148,095

Retained earnings

2,911,589

4,284,190

Treasury stock-485,011

Total shareholders’ equity

7,572,284-485,011

9,000,284

Valuation difference on marketable securities-10,875

119,979

Foreign currency translation adjustment

13,20857,036

Total accumulated other comprehensive income

2,332

177,016

Lease liabilities

Total liabilities
Net assets
Shareholders’ equity

Accumulated other comprehensive income

Stock options

48,61429,746

Minority interests

757,078996,215

Total net assets

8,380,310

10,203,263

16,023,329

21,625,786

Total liabilities and net assets-9-

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(2) Consolidated Income Statement, Comprehensive Income Statement(Consolidated Income Statement)(Unit: Thousand Yen)

Net Sales
CGS
Gross income
SG&A
Operating income
Non-operating income
Interest income
Dividend income
Gain on valuation of investment securities
Minority shareholding income
Other
Total non-operating income
Non-operating expenses
Interest payment
Share listing related expenses
Other
Total non-operating expenses
Ordinary income
Extraordinary income
Gain on sales of subsidiaries’ stocks
Gain on sales of investment securities
Total extraordinary income
Extraordinary loss
Impairment accounting losses
Loss on sales of investment securities
Loss on valuation of investment securities
Other
Total extraordinary losses
Net income before taxes
Corporate, residence, enterprise taxes
Corporate tax adjustment
Total taxes
Income before minority interests
Minority interest losses
Net income- 10 -

Previous Term
(October 1, 2012–
September 30, 2013)
45,982,078

Current Term
(October 1, 2013–
September 30, 2014)
54,345,580

37,107,091
8,874,986
7,281,685
1,593,301

44,203,614
10,141,965
7,882,012
2,259,953

5,841
1,704
52,658100,428
40,304200,936

5,099
1,686
38,35566,317
14,447125,9076,077
13,354
22,152
41,584
1,752,653

5,076
13,6294,267
22,9732,362,887

103,197
209,879
313,076

8,476
－
8,476

8,747
－
9,758
48,02766,534
1,999,195
705,296
61,370766,667
1,232,528
25,332
1,207,196

14,026
10,00025,245
5,989
55,2602,316,104
1,404,134-651,617
752,516
1,563,587
14,4001,549,187

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(Consolidated Comprehensive Income Statement)(Unit: Thousand Yen)

Income before minority interests
Other comprehensive income
Valuation difference on marketable securities
Foreign currency translation adjustment
Minority shareholdings in affiliates
Total other comprehensive income
Comprehensive income(Details)
Comprehensive income attributable to parent shareholding
Comprehensive income attributable to minority interests- 11 -

Previous Term
(October 1, 2012–
September 30, 2013)
1,232,528

Current Term
(October 1, 2013–
September 30, 2014)
1,563,587

3,532
14,889219

130,855
43,828－18,640174,683

1,251,168

1,738,271

1,225,836
25,332

1,723,871
14,400SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(3) Changes in Consolidated Shareholders’ Equity Statement
Fiscal Year Ended September 30, 2013 (October 1, 2012 – September 30, 2013)(Unit: Thousand Yen)
Shareholders’ equity
Capital
Total at previous term end

Capital reserves

2,009,979

3,110,912

15,331

9,482

Retained earnings

Total shareholders’equityTreasury stock

1,847,644-485,011

6,483,525

Change in current term
New stock issued

24,814

Dividends from retained
earnings-125,896-125,896

Net income

1,207,196

1,207,196-17,355-17,355

Change in scope of
consolidation
Net change in items otherthan shareholders’ equity
Total change in current term
Total at current term end

15,331

9,482

1,063,945‒

1,088,759

2,025,310

3,120,395

2,911,589-485,011

7,572,284

Minority
interests

Total net assets

Accumulated other comprehensive income
Valuationdifference onmarketablesecurities
Total at previous term end-14,626

Total
accumulated
othercomprehensive
incomeForeigncurrencytranslation
adjustment-1,680-16,307

Stock option

28,830750,257

7,246,304

Change in current term
New stock issued

24,814

Dividends from retained
earnings-125,896

Net income

1,207,196

Change in scope of
consolidation-17,355

Net change in items otherthan shareholders’ equity

3,751

14,88918,64019,784

6,821

45,246

Total change in current term

3,751

14,88918,64019,784

6,821

1,134,005-10,875

13,2082,332

48,614757,078

8,380,310

Total at current term end- 12 -

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

Fiscal Year Ended September 30, 2014 (October 1, 2013 – September 30, 2014)(Unit: Thousand Yen)
Shareholders’ equity
Capital
Total at previous term end

Capital reserves

2,025,310

3,120,395

27,69927,699Retained earnings

Total shareholders’equityTreasury stock

2,911,589-485,011

7,572,284

Change in current term
New stock issued

55,399Dividends from retained
earnings-176,586-176,586

Net income

1,549,187

1,549,187

Net change in items otherthan shareholders’ equity
Total change in current term
Total at current term end‒
27,69927,6991,372,601‒

1,428,000

2,053,010

3,148,095

4,284,190-485,011

9,000,284

Minority
interests

Total net assets

Accumulated other comprehensive income
Valuationdifference onmarketablesecurities
Total at previous term end-10,875

Total
accumulated
othercomprehensive
incomeForeigncurrencytranslation
adjustment
13,2082,332

Stock option

48,614757,078

8,380,310

Change in current term
New stock issued

55,399Dividends from retained
earnings-176,586

Net income

1,549,187

Net change in items otherthan shareholders’ equity

130,855

43,828

174,683-18,867

239,137

Total change in current term

130,855

43,828

174,683-18,867

239,137

1,822,953

Total at current term end

119,979

57,036

177,016

29,746996,215

10,203,263- 13 -

394,953

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(4) Consolidated Cash Flow Statement(Unit: Thousand Yen)
Previous Term
(October 1, 2012–
September 30, 2013)
Cash flow from operating activities
Net income before taxes
Depreciation and amortization
Impairment accounting loss
Amortization of goodwill
Increase (decrease) in doubtful account reserves
Increase (decrease) in bonus reserves
Gain (loss) on valuation of investment securities (gain)
Gain (loss) on sales of investment securities (-: gain)
Interest and dividends income
Interest payment
Gain (loss) on minority shareholding

Current Term
(October 1, 2013–
September 30, 2014)

Gain (loss) on sales of subsidiaries' stocks
Increase (decrease) in receivables
Increase (decrease) in inventories
Increase (decrease) in payables
Other

1,999,195
149,920
8,747
150,500
2,909
30,674-42,899-209,879-7,545
6,077-97,741-103,197-753,507-643
688,782
25,5662,316,104
180,160
14,026
126,477
8,349
26,356-13,110
10,000-6,786
5,076-43,138-8,476-885,827-49,005
1,659,743
338,417

SubtotalInterest and dividends received
Interest paid
Tax claims payment
Corporate and other taxes

1,846,960
7,545-5,80995,838-850,409

3,678,367
6,786-4,980130,960-980,432

Net cash provided by operating activities
Cash flow from investing activities
Payments into time deposits
Repayments from time deposit
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sale of investment securities
Purchase of investments in subsidiaries resulting in change
in scope of consolidation
Payments for the sale of investments in subsidiaries
resulting in a change in the scope of consolidation
Collection of loans receivable
Deposits and security deposits payment
Income from the collection of deposits and security
deposits
Other

1,094,125-100,000−-59,773-160,092-30,049
617,500−-30,614207,090-63,187
43,870-7,227
417,514

Net cash provided by (used in) investing activities- 14 -

2,830,700-1,218,000
712,000-65,612-96,506-171,102
190,000-258,505-32,926
52,331-86,112
20,474
40,211-913,748

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(Unit: Thousand Yen)
Previous Term
(October 1, 2012–
September 30, 2013)
Cash flow from financing activities
Increase (decrease) in short-term loans payable
Income from long-term loans payable
Repayment of long-term loans payable
Cash dividends paid
Cash dividends paid to minority shareholders
Other
Net cash used in financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and equivalents
Increase in cash and cash equivalents resulting from mergers
with unconsolidated subsidiaries
Decrease in cash and cash equivalents resulting from theexclusion of subsidiaries from consolidation
Cash and equivalents at term start
Cash and equivalents at term end- 15 -

Current Term
(October 1, 2013–
September 30, 2014)

189,250−-137,325-125,896-3,280-8,711-85,962
14,8891,440,567-12,586
500,000-127,772-176,586-4,160-553
178,342
21,954
2,117,249

2,444

−

-3,946−

5,131,651
6,570,715

6,570,715
8,687,965

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(5) Notes to Consolidated Financial Statements(Notes Regarding Going Concern Assumptions)Not applicable(Related to the Consolidated Cash Flow Statement)* Relationship with cash and equivalents at term end and the value of the items posted in the consolidated balance
sheet(Unit: Thousand Yen)
Previous Term
(October 1, 2012–September 30, 2013)

Current Term
(October 1, 2013–September 30, 2014)

Cash and deposits balanceTime deposits with a term of over 3 months

6,670,715-100,000

9,293,965-606,000

Cash and cash equivalents

6,570,715

8,687,965(Business Segment Information)[Business Segment Information]
1. Business Segment Overview
Our Group’s reported segments are the individual units for which independent financial information can be derived, andare considered on a regular basis by our Board of Directors for the purpose of determining the allocation of management
resources and the evaluation of earnings.
Furthermore, the Group has categorized its business segments in accordance with market categorizations, and has
determined three business segments, namely the “Internet Marketing Business,” “Media Content Business,” and “Direct
Marketing Business.” Because of their relative importance in terms of business volume, we have divided our reported
business segments into two, which are the “Internet Marketing Business” and the “Media Content Business.”
Further descriptions of our reported business segments are provided below.
Business Segment

Business Description

Internet Marketing

Internet advertising sales, Web solutions (website creation, operation, SEO services),
marketing platform operations for ad networks, cloud-based CRM services, Internet
marketing support services for corporations

Media Content

Provision of digital content for smartphones centered on games and cultivating andproducing Manga Artists aimed at planning and developing our own IP (intellectual
property) as well as operating a Manga distribution service, etc.

2. Method of Calculation Relating to Reported Business Segment Sales, Income, Assets, and Other Items
The accounting methods used for our reported business segments are the same as those mentioned in the section titled“Important basic items used in the creation of consolidated financial statements.”
Income in the reported business segment information is based on operating income.
Internal earnings and the amounts transferred between business segments are based on actual market pricing.

- 16 -

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

3. Information Relating to Reported Business Segment Sales, Income, Assets, and Other Items
Fiscal Year Ended September 30, 2013 (October 1, 2012 – September 30, 2013)(Unit: Thousand Yen)
Reported Business Segments

Other(Note 1)

Total

Adjustment(Note 2, 3)

Consolidated
Account(Note 4)

Internet
MarketingMedia Content

Subtotal

39,354,580

3,708,890

43,063,471

2,917,956

45,981,428

650

45,982,078

104,123

5,286

109,410

5,037

114,447-114,447−

Total

39,458,704

3,714,176

43,172,881

2,922,994

46,095,875-113,797

45,982,078

Operating income/loss

2,016,919-219,469

1,797,449

160,552

1,958,001-364,700

1,593,301

10,203,427

2,229,501

12,432,929

728,555

13,161,485

2,861,844

16,023,329

Sales
External sales
Internal sales,transfers

AssetsOther items
91,615
17,987
109,603
13,883
123,486
26,433
149,920
Depreciation
Change in property,
142,615
16,588159,203
5,909
165,11349,568214,681
plant and equipment
and intangible assets
1. “Other” includes the Direct Marketing Business and other businesses, which are not included in the reported segments.
2. The operating income/loss in the adjustment category of ‐¥364,700 thousand includes ¥7,025 thousand in intersegment
cancellations and ¥650 thousand in companywide income that cannot be allocated to each segment, and ‐¥372,376 thousand incompanywide expenses. Companywide income mainly consists of management fees for non-consolidated subsidiaries, while
companywide expenses include the operating costs for the holding company that cannot be allocated to specific segments.
3. The assets in the adjustment category of ¥2,861,844 thousand mainly consist of cash and deposits, investment securities, andassets associated with operations of the holding company.
4. Segment income/loss is based on an adjustment of operating income in the consolidated financial statements.

- 17 -

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

Fiscal Year Ended September 30, 2014 (October 1, 2013 – September 30, 2014)(Unit: Thousand Yen)
Reported Business Segments

Other(Note 1)

Total

Adjustment(Note 2, 3)

Consolidated
Account(Note 4)

Internet
MarketingMedia Content

Subtotal

48,033,166

3,447,438

51,480,604

2,863,676

54,344,280

1,300

54,345,580

238,798

10,587249,385

3,511

252,897−

Total

48,271,964

3,458,025

51,729,990

2,867,187

54,597,177-252,897

Operating income/loss

2,740,554

2,463,142

186,994

Assets14,901,690-277,411

17,092,927

651,095

Sales
External sales
Internal sales,transfers

2,191,237

54,345,580

2,650,136-251,597

17,744,022

3,881,763

21,625,786-390,183

2,259,953

Other items
Depreciation
123,844
11,994
135,839
7,269
143,108
37,051
180,160
Change in property,
16,588plant and equipment
119,030
125,658
4,817
130,476
22,407
152,884
and intangible assets
1. “Other” includes the Direct Marketing Business and other businesses, which are not included in the reported segments.
2. The operating income/loss in the adjustment category of ‐¥390,183 thousand includes ¥10,033 thousand in intersegment
cancellations and ¥1,300 thousand in companywide income that cannot be allocated to each segment, and ‐¥401,516 thousandin companywide expenses. Companywide income mainly consists of management fees for non-consolidated subsidiaries, while
companywide expenses include the operating costs for the holding company that cannot be allocated to specific segments.
3. The assets in the adjustment category of ¥3,881,763 thousand mainly consist of cash and deposits, investment securities, andassets associated with operations of the holding company.
4. Segment income/loss is based on an adjustment of operating income in the consolidated financial statements.

- 18 -

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results[Information Relating to Reported Business Segment Impairment Accounting Losses on Non-current Assets]
Fiscal Year Ended September 30, 2013 (October 1, 2012 – September 30, 2013)(Unit: Thousand Yen)
Reported Business Segments
Internet
MarketingImpairment
accounting losses

Media
Content

4,582

Subtotal

4,165

Other

Total
−

8,747

8,747

Companywide/
Eliminations
−

Total

8,747

Fiscal Year Ended September 30, 2014 (October 1, 2013 – September 30, 2014)(Unit: Thousand Yen)
Reported Business Segments
Internet
MarketingImpairment
accounting losses

Media
Content−

Subtotal

11,250

Other

Total
−

11,250

11,250Companywide/
Eliminations
2,776

Total

14,026[Information Relating to Reported Business Segment Amortization of Goodwill and Unamortized Balance]
Fiscal Year Ended September 30, 2013 (October 1, 2012 – September 30, 2013)(Unit: Thousand Yen)
Reported Business Segments
Internet
MarketingMedia
Content

Subtotal

Other

Total

Companywide/
Eliminations

Total

Total amortization−

150,500

150,500−

150,500−

150,500

Balance as of term
end−

406,243406,243−406,243−406,243

Fiscal Year Ended September 30, 2014 (October 1, 2013 – September 30, 2014)(Unit: Thousand Yen)
Reported Business Segments
Internet
MarketingMedia
Content

Subtotal

Other

Total

Companywide/
Eliminations

Total

Total amortization−

126,477

126,477−

126,477−

126,477

Balance as of term
end

332,690

268,515

601,206−

601,206−

601,206[Information Relating to Reported Business Segment Gains on Negative Goodwill]
Fiscal Year Ended September 30, 2013 (October 1, 2012 – September 30, 2013) and Fiscal Year Ended September 30,
2014 (October 1, 2013 – September 30, 2014)
Not applicable- 19 -

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results(Per-share information)(Unit: Yen)
Item

Previous Term
(October 1, 2012–September 30, 2013)

Book Value per Share

300.26EPS

47.90

Current Term
(October 1, 2013–September 30, 2014)361.8561.22
59.54

Fully Diluted EPS
46.56(Notes) 1. The Company implemented a 200-for-1 stock split for its common stock on October 1, 2013. Book value per share, EPS
and fully diluted EPS in FY9/13 are calculated on the assumption that the stock split was implemented at the beginning of the previous
fiscal year.

2. The base for calculating EPS as well as fully diluted EPS is as follows.
Previous Term
(October 1, 2012–
Item
September 30, 2013)

Current Term
(October 1, 2013–
September 30, 2014)

EPS
Net income (¥1,000)

1,207,196

1,549,187−−

Net income associated with
common shares (¥1,000)

1,207,196

1,549,187

Average number of shares
outstanding during the term

25,201,633.33

25,305,333.33

Amount not attributed to commonshareholders (¥1,000)

Fully Diluted EPS−−

Increase in the number of commonshares727,111.54

715,062.19

Of which, stock options (numberof shares)

727,111.54

715,062.19

Adjusted net income (¥1,000)

Overview of dilutive shares notincluded in the calculation of fully
diluted net income per share due toabsence of impact from dilution−−(Material subsequent events)
The Board of Directors passed a resolution at a meeting held on September 16, 2014 to transfer all shares of the Group’s
consolidated subsidiary SEPTENI DIRECT MARKETING CO., LTD., which handles direct marketing, to ZENRIN
CO., LTD. in an effort to concentrate management resources on the Group’s core businesses, namely Internet Marketing
Business and the Media Content Business. The shares were transferred on October 1, 2014. In association with thetransfer of shares, the Company plans to post a gain of ¥1,098 million as extraordinary income from the sale of shares inthe subsidiary in the first quarter of the fiscal year ending September 30, 2015.

- 20 -

SEPTENI HOLDINGS CO., LTD. (4293), FY9/14 Business Results

5. Other
Changes in Directors (scheduled for December 19, 2014)
Candidate for a newly appointed director
Tatsuya Kimura (currently professor at the Graduate School of Commerce, Waseda University)
He is a candidate for External Director as established by the Article 2, Paragraph 3, Item 7 of the Companies Act.
[Reference]
Details that have been already announced in the “Notice regarding changes to representative directors and directors”
dated October 2, 2014.
Name

New Title

Mamoru Nanamura

Honorary Chairman

Muneyoshi Nomura

Internal Auditor- 21 -

Current Title
Chairman of the Board andRepresentative Director
Vice-chairman of the Board