This document is a partial translation of the original document in Japanese. Digital Arts Inc. provides this translation for your reference and convenience onlyand without any warranty as to its accuracy or otherwise. In the event of any discrepancy, the original document in Japanese shall prevail.

October 27, 2016
Name of listed company: Digital Arts Inc.
Representative:
Toshio Dogu, CEO(TSE First Section Stock Code: 2326)
Contact person:
Hidenobu Akazawa
Director, Administration Department(Tel: 03-5220-6045)

Notice of Difference between FY03/17 Consolidated Financial Forecast and Results
For Second Quarter Ended September 30, 2016 (Japan GAAP)
Digital Arts Inc. (the “Company”) announces that its consolidated financial results for the second quarter ended
September 30, 2016 is anticipated to differ from the consolidated financial forecasts for the relevant period released on
May 11, 2016.
1.

Differences between Forecast and Results
Differences between FY03/17 Consolidated Financial Forecasts and Results for Second Quarter
Ended September 30, 2016 (Cumulative) (April 1, 2016 through September 30, 2016)
NetsalesOperatingincome

Ordinary
incomeNet income
attributable toowners ofparent

Earnings
per share(2Q)

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Yen

Previous forecasts (A)2,222608

608

363

26.08

Actual results (B)

2,420

789

767

454

32.62

Change (B-A)

197

181

158

91

Rate of Change (%)

8.9

29.7

26.0

25.1

1,935

497

499

314

[Reference] Results for the second
quarter ended September 30, 2015

Differences between FY03/17 Non-Consolidated Financial Forecasts and Results for Second Quarter
Ended September 30, 2016 (Cumulative) (April 1, 216 through September 30, 2016)
NetsalesOperatingincomeEarnings
per share(2Q)

Ordinary
incomeMillions of yen

Millions of yen

Millions of yen

Yen

Previous forecasts (A)

2,264

792

546

39.23

Actual results (B)

2,465

918

619

44.46

Change (B-A)

200

126

72

Rate of Change (%)

8.9

16.0

13.4

1,933

659

437

[Reference] Results for the second
quarter ended September 30, 2015

31.52

22.64

2.

Reasons for the Differences

The Company’s actual net sales and incomes are expected to exceed the respective forecast due to the following reasons.
During the cumulative second quarter ended September 30, 2016 (consolidated and non-consolidated), demand for theCompany’s mainstay product in the public-sector market, i-FILTER (and/or D-SPA) and m-FILTER, increased
dramatically as a result of government agencies in the prefectural and local municipality levels performing measures toenhance cyber security in accordance to a guideline issued by the Ministry of Internal Affairs and Communications tofundamentally enhance information security in local municipalities.
The Company expects this favorable environment to continue mainly in the public-sector market. Consolidated forecastfor FY03/17 (April 1, 2016 through March 31, 2017) is currently under review, however the Company does not plan torevise its Consolidated Financial Results (“Kessan Tanshin”) to be announced and published later today.
FY03/17 Consolidated Financial Results for Second Quarter Ended September 30, 2016 (“Kessan Tanshin”) will beannounced accordingly later today.