Summary of Consolidated Financial Statement
for the Three Months Ended December 31, 2021 [IFRS]
February 10, 2022
Listed Market: TSE
SEPTENI HOLDINGS CO., LTD.
Stock Code: 4293 URL: https://www.septeni-holdings.co.jp/en
Representative: Representative Director, Group President and Chief Executive Officer Koki Sato
Contact Person: Group Executive Officer Tei Go, Telephone: +81-3-6857-7258
Anticipated Financial Report Filing Date:
February 14, 2022
Anticipated Dividend Payment Date:―
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 Financial Results for the Three Months Ended December 31, 2021 (From October 1, 2021 to December 31,
2021)(1) Consolidated Earnings(% figures represent year-over-year change)
Revenue

Operating Profit

Million Yen

1Q FY9/22
1Q FY9/21% Million Yen

6,572
5,275

Non-GAAP
Operating Profit

24.6
20.9

1,940
1,205

% Million Yen

61.1
110.4

Profit before tax% Million Yen

2,020
1,215

66.2
97.9

% Million Yen

1,980
1,288

Profit for the period
attributable toowners of theparentProfitfor the period

53.7
113.5

1,275
863

% Million Yen

47.8
120.5

1,275
865

%

47.4
123.2

(Note) Non-GAAP operating profit refers to the profit indicator used to assess ordinary business conditions after adjustments are made to IFRS-based
operating profit pertaining to temporary factors such as stock-based compensation expenses, the impairment losses and gains or losses on the sales of
fixed assets.

Basic earnings per share
1Q FY9/22
1Q FY9/21

Diluted earnings per share

Yen

Yen

10.08
6.84

10.04
6.81

(2) Consolidated Financial Position
Total Assets

1Q FY9/22
FY9/21Equity attributable to ownersof the parent

Total Equity

Ratio of equity attributable toowners of the parent to total
assetsMillion Yen

Million Yen

Million Yen%

43,04042,011

19,34718,44519,32818,42644.9
43.9

2. Dividend Conditions
End of 1Q
FY9/21
FY9/22
FY9/22Estimate

Dividends
End of 3Q

End of 2Q

Term-end

Total

Yen

Yen

Yen

Yen

Yen

―
―

―

―

3.40

3.40

―

―

―

―

(Note) Changes in dividends estimates during the most recent quarter: None
Estimates for dividends in the fiscal year ending September 30, 2022 have yet to be decided.

3. Consolidated Financial Results Forecast for the Fiscal Year Ending September 30, 2022 (From October 1, 2021 toSeptember 30, 2022)
Revenue
Full Year

Non-GAAP Operating profit(% figures represent year-over-year change)
Profit for the period
attributable to owners of the
Basic earnings per shareparentMillion Yen%

Million Yen%

Million Yen%

Yen

30,000

40.3

5,300

39.6

3,900

49.8

20.68

(Note) Changes in consolidated earnings estimates during the most recent quarter: Applicable

*Annotation(1) Important changes in subsidiaries, including changes in the scope of consolidation: None
(2) Changes in accounting methods, procedures, presentation methods
Changes in accounting policies required by IFRSs:
None
Other changes in accounting methods:
None
Changes in accounting estimates:
None(3) Shares issued (common stock)
Shares issued as of term-end (incl. Treasury stock):
Treasury stock as of term-end:
Average number of shares outstanding:

1Q FY9/22
1Q FY9/22
1Q FY9/22

138,916,500 FY9/21
12,463,440 FY9/21
126,453,060 1Q FY9/21

138,916,500
12,463,440
126,453,060*The summary of consolidated financial results for the fiscal year is not subject to the auditing by the Certified Public
Accountants or the audit corporation.
*Disclaimer regarding appropriate use of forecasts and related points of note
(1) Regarding Consolidated Financial Results Forecast
Any description regarding the future in this material, such as financial results forecast and future outlook, is basedon the available information and certain conditions which the Company believes to be reasonable at this time, and actual
financial results may be substantially different from the forecast due to various factors.
For the conditions which the forecast is based on, please refer to “1. Qualitative Information on Results for theThree Months Ended December 31, 2021 (2) Explanation of Consolidated Earnings Forecasts and Other ForwardLooking Information.”(2) Appendix
The Company will hold a financial results briefing as below. The briefing materials will be available on the website
after this summary is disclosed. The audio archive of briefing will be also available on the website.
February 10, 2022 (Thu.) - FY9/22 1st Quarter Financial Results Briefing for Institutional Investors, Analysts and thePressIndex1. Qualitative Information on Results for the Three Months Ended December 31, 2021….……………………….
(1) Explanation for Earnings Performance……………………………………………………………………….
(2) Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Information………………...
2. Quarterly Consolidated Financial Statements and Key Notes……………………………………………………
(1) Quarterly Consolidated Statement of Financial Position ……………………………………………………
(2) Quarterly Consolidated Statement of Profit or Loss…………………………………………………………
(3) Quarterly Consolidated Statement of Comprehensive Income………………………………………………
(4) Quarterly Consolidated Statement of Changes in Equity ……………………………………………………
(5) Quarterly Consolidated Statement of Cash Flow…………………………………………………………….
(6) Notes on Quarterly Consolidated Financial Statement ....……………………………………………………
(i) Notes Relating to Assumptions for the Going Concern …………………………………………………
(ii) Information on Reportable Segments …………………………………………………………………..
(iii) Subsequent Events ……………………………………………………………………………………..

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8
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10
10
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1. Qualitative Information on Results for the Three Months Ended December 31, 2021
(1) Explanation for Earnings Performance
In the 1Q of the current fiscal year, in the main Digital Marketing Business, both revenue and profits
increased due to the organic growth and the promotion of the alliance with the Dentsu Group. In the Media
Platform Business, the loss narrowed due to the growth of Manga Content Business.
As a consequence, revenue was ¥6,572 million (up 24.6% year on year), operating profit was ¥1,940
million (up 61.1% year on year), Non-GAAP operating profit was ¥2,020 million (up 66.2% year on year), andprofit attributable to owners of the parent was ¥1,275 million (up 47.4% year on year).
The Group discloses consolidated business results in terms of both its internal measures which the
management relies upon in making decisions (hereinafter the “Non-GAAP financial measures”) and thoseunder IFRS. Non-GAAP operating profit is operating profit under IFRS after deducting unusual items tomeasure constant business results. The management believes that the disclosure of Non-GAAP financial
measures facilitates comparison between the Group and peer companies in the same industry or comparison ofits business results with those of prior fiscal years by stakeholders, and can provide useful information inunderstanding the underlying business results of the Group and its future outlook. Unusual items refer to oneoff items, such as stock-based compensation expenses, impairment loss and gain or loss on sales of non-current
assets, that the Group believes shall be excluded for the purposes of preparing a future outlook based on certain
rules. In addition, because it will be useful for users of financial statement, the Group voluntarily disclose “Net
Sales”, which is shown as the total amount for all transactions, although the disclosure is not in accordancewith IFRS.
Reconciliation from operating profit to Non-GAAP operating profit and Net Sales are as below:(unit: ¥mn)
1Q FY2021(Previous Consolidated
Cumulative 1Q)

Operating profit

1Q FY2022(Current Consolidated
Cumulative 1Q)

ChangePercentage
of change

1,205

1,940

735

61.5%

Adjustment (Stock-based
compensation expenses)

―

14

14

Adjustment (Others)

10

66

56

Non-GAAP operating profit

1,215

2,020

805

66.2%

Net Sales

23,02730,110

7,083

30.8%

Operating results by reportable segment are as follows.
(i) Digital Marketing Business
The Digital Marketing Business provides comprehensive support for corporate digital transformation(DX), centered on digital marketing.
In the quarter under review, the organic sales increased, and the proportion of sales accounted for by thealliance with the Dentsu Group increased compared with the previous fiscal year, and the number ofcooperative clients with the Dentsu Group increased.
As a consequence, revenue was ¥5,999 million (up 27.5% year on year) and Non-GAAP operating profit
was ¥2,822 million (up 43.2% year on year).
(ii) Media Platform Business
The Media Platform Business consists of Manga Content Business “GANMA!”, Recruitment Platform
Business “ViViViT”, Social Contribution Business “gooddo”, Childcare Platform Business “Babyful” etc.
In the quarter under review, although the Manga Content Business expanded compared with the previous
fiscal year, mainly from billing revenues, revenues decreased as a result of a decrease in revenues from otherbusinesses. On the other hand, the loss decreased due to an increase in the mix of high-margin products suchas subscriptions.

-2-As a result, it recorded revenue of ¥644 million (down 2.5% year on year) and Non-GAAP operating lossof ¥262 million (compared to Non-GAAP operating loss of ¥263 million in the previous year).
(2) Explanation of Consolidated Earnings Forecasts and Other Forward-Looking Information
For the full-year consolidated earnings estimates for the fiscal year ending September 2022, the Company
revised its estimates in consideration of the impact on earnings related to the capital and business alliances with
Dentsu Group Inc. Please refer to “Notifications on Revisions to the Full-Year Consolidated Earnings Estimates
for the FY2022” revealed on February 10, 2022.

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2. Consolidated Financial Statements and Key Notes(1) Quarterly Consolidated Statement of Financial Position(Thousand yen)
FY2021(Ended September 30, 2021)

1Q FY2022(Ended December 31, 2021)

16,899,990
16,085,450
119,530
12,941
333,62233,451,533

17,389,536
16,844,852
121,959
11,805
460,875
34,829,027

310,284
1,653,760
67,290294,317
1,512,070
63,825997,026

1,014,472

3,929,443
32,646
1,569,185
8,559,635
42,011,169

3,748,420
27,2451,550,641
8,210,989
43,040,015

AssetsCurrent assets
Cash and cash equivalents
Trade receivables
Inventories
Other financial assets
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Investments accounted for using equity
methodOther financial assets
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets-4-

(Thousand yen)
FY2021(Ended September 30, 2021)

1Q FY2022(Ended December 31, 2021)

14,043,615
2,549,116
1,024,502
2,711,491
20,328,724

15,740,197
2,531,189
506,616
1,807,592
20,585,595

3,082,067
155,090
3,237,157
23,565,881

2,951,226
155,845
3,107,071
23,692,666

2,125,384
3,901,272-1,691,842
14,322,283-230,678

2,125,384
3,915,314-1,691,842
15,167,016-188,077

18,426,419

19,327,796

18,86918,445,288
42,011,169

19,553
19,347,350
43,040,015

Liabilities and Equity
Liabilities
Current liabilities
Trade payables
Other financial liabilities
Current income taxes payable
Other current liabilities
Total current liabilities
Non-current liabilities
Other financial liabilities
Provisions
Total non-current liabilities
Total liabilities
EquityEquity attributable to owners of parent
Share capital
Capital surplus
Treasury shares
Retained earnings
Other components of equity
Total equity attributable to owners ofparentNon-controlling interests
Total equity
Total liabilities and equity-5-(2) Quarterly Consolidated Statement of Profit or Loss

Revenue
Cost of sales
Gross profit
Selling, general and administrative
expenseOther income
Other expense
Operating profit
Finance income
Finance costs
Share of profit from investments
accounted for using equity method
Profit before tax
Income tax expense
Profit1Q FY2021(From October 1, 2020 to
December 31, 2020)
5,275,221
1,004,558
4,270,663(Thousand yen)
1Q FY2022(From October 1, 2021 to
December 31, 2021)
6,572,468
1,120,078
5,452,390

3,061,119

3,446,791

5,934
10,7991,204,679
61,376
12,524915
66,317
1,940,197
32,607
9,753

34,737

17,445

1,288,268
425,086
863,182

1,980,495
705,137
1,275,358

864,843-1,661
863,182

1,274,674
684
1,275,358

6.84
6.81

10.08
10.04

Profit (loss) attributable to:
Owners of parent
Non-controlling interests
Total
Earnings per share
Basic earnings per share (Yen)
Diluted earnings per share (Yen)-6-

(3) Quarterly Consolidated Statement of Comprehensive Income(Thousand yen)

1Q FY2021(From October 1, 2020 to
December 31, 2020)
863,182

1Q FY2022(From October 1, 2021 to
December 31, 2021)
1,275,358-2,34924,503-3,994

15,567

3,298

2,531

-3,04542,601

Total comprehensive income

860,137

1,317,960

Comprehensive income attributable to:
Owners of parent
Non-controlling interests
Comprehensive income

861,798-1,661
860,137

1,317,275
684
1,317,960

Profit (loss)
Other comprehensive income
Items that will not be reclassified to profit
or loss
Net changes in financial assets measured
at fair value through othercomprehensive income
Items that may be reclassified to profit orloss
Exchange differences on translating
foreign operations
Cash flow hedges
Total other comprehensive income, net of
tax

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(4) Quarterly Consolidated Statement of Changes in Equity(Thousand yen)
Equity attributable to owners of parent

Balance at October 1, 2020

SharecapitalCapitalsurplusTreasurysharesRetainedearnings

Other
componentsof equity

Total

Noncontrollinginterests

Total equity

2,125,384

3,664,788-1,691,842

11,971,086-276,037

15,793,379

17,97815,811,357

Quarterly Profit (loss)

－

－

－

864,843－864,843-1,661

863,182

Other comprehensive income

－

－

－

－

-3,045-3,045－-3,045

Total comprehensive income
Dividends of surplus
Other
Total amount of transactions
with owners
Balance at December 31, 2020

－

－

－

864,843-3,045

861,798-1,661

860,137

－
－

－
－

－
－

-252,906-1－-252,906－－

1-1,895-252,906-1,895－－－-252,907

1-252,906-1,895-254,801

2,125,384

3,664,788-1,691,842

12,583,022-279,081

16,402,271

14,422

16,416,693(Thousand yen)
Equity attributable to owners of parent

Balance at October 1, 2021

SharecapitalCapitalsurplusTreasurysharesRetainedearnings

Other
componentsof equity

Total

Noncontrollinginterests

Total equity

2,125,384

3,901,272-1,691,842

14,322,283-230,678

18,426,419

18,86918,445,288

Quarterly Profit (loss)

－

－

－

1,274,674－

1,274,674

684

1,275,358

Other comprehensive income

－

－

－

－

42,60142,601－42,601

Total comprehensive income
Dividends of surplus
Other
Total amount of transactions
with owners
Balance at December 31, 2021

－

－

－

1,274,674

42,601

1,317,275

684

1,317,960－－－
14,042－－-429,940－－－-429,940
14,042－－-429,940
14,042－

14,042－-429,940－-415,898－-415,898

2,125,384

3,915,314-1,691,842

15,167,016-188,077

19,327,796

19,553

19,347,350-8-

(5) Quarterly Consolidated Cash Flow Statement

1Q FY 2021
(From October 1, 2020 to
December 31, 2020)(Thousand yen)
1Q FY 2022
(From October 1, 2021 to
December 31, 2021)

1,288,268

1,980,495

256,701-60
7,462

182,661-123
6,863-34,737-17,445-65,188

15,915-1,023,156-14,378
631,341
551,323
1,597,576
60-7,545-475,107
1,114,984-759,402-2,4291,696,582-1,078,492
2,024,625
123-6,944-1,015,648
1,002,155-159,156-37,022-5,390-41,414-20,717-3,047433

289,591

81,200-119,935

21,414
245,826-191,668-208,624-252,906-1,895-655,093-191,668-152,394-429,940－-774,003-3,993

15,567335,963489,546

14,080,864

16,899,990

14,416,827

17,389,536

Cash flows from (used in) operating activities
Profit before tax
Adjustments:
Depreciation and amortization expense
Interest income and dividend income
Interest expenses
Share of (profit) loss of entities accounted
for using equity method
Other
Increase or decrease in working capital
Decrease (increase) in operating receivables
Decrease (increase) in inventories
Increase (decrease) in operating payables
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Cash flows from (used in) operating activities
Cash flows from (used in) investing activities
Purchase of securities
Purchase of property, plant and equipment
Purchase of intangible assets
Proceeds from collection of lease andguarantee deposits
Other
Cash flows from (used in) investing activities
Cash flows from (used in) financing activities
Proceeds from long-term borrowings
Repayments of lease obligations
Cash dividends paid
Other
Cash flows from (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of
periodCash and cash equivalents at end of period-9-(6) Notes on Consolidated Financial Statement(i) Notes Relating to Assumptions for the Going Concern
No applicable items.
(ii) Information on Reportable Segments
1. Overview of reportable segments
The Group has a holding company structure where the Company is a holding company and its
subsidiaries (or their groups) are business units. Activities directly related to revenue generation are conducted
solely by business units, which consist of the Company’s subsidiaries (or their groups).
The Group’s reportable segments are based on business segments for which separate financial
information is available and that the highest decision-maker examines on a regular basis to determine the
distribution of management resources and evaluate the results. In consideration of similarities among the
economic characteristics of each business segment and their quantitative importance and for the purpose of
enabling the users of the financial statements to appropriately evaluate the Group’s businesses and theeconomic circumstances for the businesses and their effects on the businesses, the Group discloses information
on two reportable segments: the Digital Marketing Business and the Media Platform Business,
i. Digital Marketing Business
The Digital Marketing Business consists of business segments that provide comprehensive digitaltransformation support to clients, mainly in the digital marketing domain such as the sales and operation ofadvertisement, as well as providing solutions utilizing data and AI and marketing support in integration of
online and offline through the alliance with the Dentsu Group.
ii. Media Platform Business
The Media Platform Business consists of Manga Content Business “GANMA!”, Recruitment Platform
Business “ViViViT”, Social Contribution Business “gooddo”, Childcare Platform Business “Babyful” etc.
This segment includes business units that have commenced operation in recent years and have not made aprofit due to prior investment for revenue generation. The highest decision-maker makes decisions on the
distribution of management resources to those business units and evaluates their results, assuming risks andeconomic value that allow the Group to recover the investment costs through future revenue generation.
2. Measurement of reportable segments’ profits and losses
Segment profit uses Non-GAAP operating profit based on IFRS adjusted for temporary factors suchas stock-based compensation expenses, impairment losses and gains (losses) on sales of property, plant andequipment. Non-GAAP operating profit is a profit indicator that measures the performance of a permanentbusiness from operating profit based on IFRS adjusted for temporary factors. Our managements believe that
disclosing Non-GAAP measures facilitates peer and prior year comparisons for stakeholders and provides
useful information in understanding our group's permanent results of operations and future prospects.
Temporary factors refer to one-time gains and losses, such as stock-based compensation expenses, impairment
losses, and gains and losses on sales of fixed assets, that the Group considers should be excluded based on
certain rules from the perspective of preparing future forecasts.
The Group voluntarily discloses the total amount of all transactions as net sales. The disclosure of net
sales is not disclosure in accordance with IFRS. The management believes, however, that net sales are useful
information for users of the financial statements, and voluntarily discloses net sales in its consolidated net
profit-and-loss statement and segment information as reference information.
The prices of inter-segment transactions are determined based on the prices of transactions withexternal customers.

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3. Information on reportable segments’ profits and losses
Previous consolidated cumulative 1Q (from October 1, 2020 to December 31, 2020)(Thousand yen)
DigitalMarketing
4,704,409

Media
Platform*4
660,292

Total

Adjustment

Consolidated

Segment revenue *1
5,364,701-89,480
5,275,221
Segment profit
1,970,899-262,612
1,708,287-492,925
1,215,362(loss)*2*3
Segment sales *1
22,604,862
660,292
23,265,154-237,859
23,027,295(Notes) 1. Adjustments include the elimination of profit and loss transactions between reportable segments.
2. The segment profit is non-GAAP operating profit.
3. Adjustment includes the elimination of profit and loss transactions between reportable segments andexpenses for the operation of the holding company not attributable to reportable segments. Expenses
related to the operation of the holding company consist mainly of personnel expenses for the holding
company.
4. Segment revenue, loss and sales of the Media Platform Business include amounts related to the Medical
Platform Business “Pharmarket,” which was transferred on April 1, 2021.
Current consolidated cumulative 1Q (from October 1, 2021 to December 31, 2021)(Thousand yen)
DigitalMarketingMedia Platform

Total

Adjustment*2

Consolidated

Segment revenue *1
5,998,922
643,967
6,642,888-70,420
6,572,468
Segment profit (loss)
2,822,436-261,831
2,560,605-540,210
2,020,396*2*3
Segment sales *1
29,652,235
643,967
30,296,202-186,182
30,110,020(Notes) 1. Adjustments include the elimination of profit and loss transactions between reportable segments.
2. The segment profit is non-GAAP operating profit.
3. Adjustment includes the elimination of profit and loss transactions between reportable segments andexpenses for the operation of the holding company not attributable to reportable segments. Expenses
related to the operation of the holding company consist mainly of personnel expenses for the holding
company.
Reconciliation of segment profit (loss) and profit before tax

Segment profit (non-GAAP operating profit)
Selling, general and administrative expense
Other profit (loss) (net)
Financial profit (loss) (net)Share of profit of entities accounted for using equity
methodProfit before tax

1Q FY2021(From October 1, 2020 to
December 31, 2020)
1,215,362―-10,684
48,853(Thousand yen)
1Q FY2021(From October 1, 2021 to
December 31, 2021)
2,020,396-14,042-66,157
22,85334,737

17,445

1,288,268

1,980,495- 11 -

(iii) Subsequent Events
The Company and Dentsu Group Inc. concluded a capital and business alliance agreement ("Capitaland Business Alliance Agreement") on October 28, 2021, with the aim of becoming the largest digitalmarketing partner in Japan that leads the development of the industry by providing the best solutions toclients through collaboration between the two companies, based on an environment where personnel with awide variety of talents gather to work with full job satisfaction. Based on the Capital and Business AllianceAgreement, on January 4, 2022, the Company implemented a share exchange with Dentsu Direct Inc.
(“Dentsu Direct”), a wholly owned subsidiary of Dentsu Group Inc., to exchange shares by making theCompany the wholly owning parent company and making Dentsu Direct a wholly owned subsidiary (“Share
Exchange”), an issuance of new shares through a third-party allotment to Dentsu Group Inc. as anunderwriter (“Third-Party Allotment”), and a share transfer with Dentsu Group Inc. to acquire a portion(25.00%) of the common shares of Dentsu Digital Inc. (“Dentsu Digital”) held by Dentsu Group Inc. (“Share
Transfer”) and making Dentsu Digital an equity method affiliate of the Company.
1. Matters related to the Share Exchange
The Company conducted the Share Exchange with Dentsu Direct on January 4, 2022, and Dentsu
Group Inc. conducted the Share Exchange by Dentsu Direct.
i. Method and effective date of the Share Exchange
The Share Exchange is a share exchange in which the Company is a wholly-owning parent company
and Dentsu Direct is a wholly-owned subsidiary. The Share Exchange was approved by the resolution of theshareholders of both the Company and Dentsu Direct. The effective date of the Share Exchange is January 4,
2022.
ii. Overview of the Share Exchange
Company Name
Share Exchange Ratio
Number of shares to be delivered
upon the Share Exchange

Company(Wholly-owning parent company
after the Share Exchange)
1

Dentsu Direct(Wholly-owned subsidiarythrough the Share Exchange)
3,274

Company’s common stock: 12,768,600 shares(Note 1) Allocation ratio of shares for the Share Exchange (Share Exchange Ratio)
3,274 common shares of the Company were allotted and delivered per share of Dentsu Direct.
(Note 2) Number of new shares of the Company to be issued as a result of the Share Exchange
The Company has allocated 12,768,600 shares of its common stock through the Share Exchange.
As for the shares to be delivered, the Company decided to allocate 10,724,240 shares of its
treasury stock and issue 2,044,360 new shares of common stock.

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iii. Outline of accounting procedure
The Share Exchange was accounted for using the acquisition method under IFRS 3, Business
Combinations. The following table presents the components of the fair value of assets acquired and liabilities
assumed as of the date of acquisition and the purchase consideration.
(Million yen)
Cash and cash equivalents

162

Trade receivables

3,443

Other current and non-current assets

1,938

Trade payables-2,867

Other current and non-current liabilities-804

Non-controlling interests *2-15

Goodwill *3

4,361
Total

6,218

Common stock of the Company delivered on the acquisition date *4

6,218

Total acquisition consideration

6,218(Note 1) The fair value of assets acquired and liabilities assumed is calculated by comprehensively taking into
account financial and asset conditions scrutinized through due diligence by external specialist agencies
and corporate value assessments by external specialist agencies.
(Note 2) Non-controlling interests are measured by multiplying the fair value of the identifiable net assets of theacquired company at the acquisition date by the percentage ownership after the business combination,
except for the portion individually attributable to non-controlling interests.
(Note 3) Primarily represents future excess earning power expected from future business development. In
addition, as the calculation of the fair value of identifiable assets as of the acquisition date has not been
completed and the allocation of the acquisition cost has not been completed as of the acquisition date,goodwill is the amount calculated on a provisional basis based on reasonable information available as of
the acquisition date. The goodwill recognized is not expected to be deductible for tax purposes.
(Note 4) The number of shares of our common stock delivered in the Share Exchange includes the appropriationof 10,724,240 shares of treasury stock held by us. Common stock delivered on the acquisition date ismeasured at the amount valued at the closing price on the day immediately preceding the acquisition.
(Note 5) Acquisition-related costs of ¥63 million related to the business combination are scheduled to berecorded in "Other expenses."iv. Pro forma information
Assuming that the business combination had taken place at the beginning of the current consolidated
fiscal year, revenues in the condensed quarterly consolidated statements of income would have been ¥7,997
million and quarterly profits would have been ¥1,375 million.
The pro forma information has not been audited. The information is not necessarily indicative of
events that may occur in the future. It is not meant to be indicative of the results of operations of The
Company Group had the investment actually been made as of the beginning of the period.

- 13 -

2. Matters related to the Third-Party Allotment
The Company allocated its shares to Dentsu Group Inc. through a third-party allotment of shares
under the following conditions after necessary procedures based on laws and regulations, etc., and Dentsu
Group Inc. underwrote them.
- The number of shares for subscription: 70,118,794 shares of common stock (Issuance of 70,118,794 newshares)- Issue price: 465 yen per share- Amounts designated as stated capital: 232.5 yen- Amount of fund raising: 32,605,239,210 yen- Payment date: January 4, 2022
- Uses of funds to be raised: Funds have been allocated principally to funds for the acquisition of shares ofDentsu Digital through the Share Transfer (acquisition consideration: ¥31,250 million).
- Others:① The Third-Party Allotment shall be subject to the fulfillment of certain preconditions such as theentry into force of the Share Exchange.
② The Third-Party Allotment shall be subject to the entry into force of the notification in accordancewith the Financial Instruments and Exchange Law and the approval of the proposal relating to theThird-Party Allotment at the Ordinary General Meeting of Shareholders.
3. Matters related to the Share Transfer
On January 4, 2022, Dentsu Group Inc. transferred its 3,675 shares of common stock of Dentsu
Digital Inc. to the Company, and the Company acquired them.
- Number of shares and ratio of voting rights held by the Company before and after the transfer.
Before the transfer
After the transfer

Number of shares held―
3,675 shares- 14 -

Ratio of voting rights―
25.00%