Vol.

49

2023.4.12023.9.30

Securities Code: 7458

To Our Stakeholders

TOP MESSAGE
I would like to begin by expressing my appreciation to our shareholders for their continued support.
We hereby report our financial results for the second quarter of our 49th fiscal year.
In the second quarter of the fiscal year under review, we believe that the business environment has improved somewhat more than it did in the previous fiscal
year, with the downgrading in May 2023 of the status of COVID-19 under the Act on the Prevention of Infectious Diseases and Medical Care for Patients with Infectious
Diseases.
In the commercial karaoke business, we released LIVE DAM AiR in April as the latest flagship model. It has been well received for its enhanced functionality thatenables users to further pursue the joy of singing. In addition to efforts to strengthen our stable revenue base by promoting the replacement of old models with newones, we strived to enhance the appeal of our products by further enriching video content, one of DAM’s strengths. In the seniors’ market, we have become able toconduct door-to-door sales at an increasing number of facilities, and we are striving to increase the number of operating units.
In the karaoke room and restaurant business, we implemented various measures for commemorating the 35th anniversary of BIG ECHO to stimulate demand
among those who want to sing, particularly among more casual customers who had fewer opportunities to enjoy karaoke due to the COVID-19 pandemic. Moreover,reservations at restaurants have been robust, leading to attracting more customers than prior to the COVID-19 pandemic, and we continue to develop brands to satisfy
emerging needs.
Turning to other businesses, the parking business, which we are focusing on as the third pillar of our business, steadily expanded in scale. We worked to enhanceawareness of THE PARK when it comes to land utilization, through means such as TV commercials.
As a result of our implementation of a host of measures in each of these businesses, we achieved record-high net sales for a second quarter, with the growth ofthe parking business contributing to the results as well. For the current fiscal year, we forecast full-year results nearing pre COVID-19 pandemic levels, with net sales of
144.5 billion yen, operating profit of 18.0 billion yen, ordinary profit of 19.1 billion yen, and profit attributable to owners of parent of 12.7 billion yen. In the second half ofthe current fiscal year, we will continue to stimulate demand for karaoke—which is fun and good for health—thereby promoting the reinforcement of our stable revenue
base.
As a leading company in the karaoke industry, the Company will continue to grow by further enhancing the appeal of karaoke under the corporate philosophy of “moremusic to society, more service to society,” and by contributing to the development of the entire karaoke industry as well as to the resolution of societal issues such as
extending healthy lifespans.
We ask for your continued support and understanding.
President

Tadahiro Hoshi

Welcome to an Amazing“Ai” Experience.
We are taking the satisfaction, pleasure,and excitement of singing and transforming
it into a truly immersive experience.

INTERVIEW
Senior Managing Corporate Officer
General Manager of Development Headquarters, Chief Officer of Entertainment Business Headquarters

Interview with Yuichi Murai

Constantly undertaking technologicalinnovations to make singing enjoyable for all
Utilization of technology can only be achieved byfulfilling the wishes of our customers

pandemic, through the introduction of LIVE DAM AiR, we intend to enable

The karaoke population has long remained at around 50 million, despite

customers to rediscover the sound quality only found in our DAM systems

something of a decline in recent years due to the COVID-19 pandemic.

as well as the appeal of the actual artist/live show videos and precise

Karaoke is absolutely one of Japan’s most popular forms of entertainment.

scoring we are familiar with from television. We also intend to enable

With the aim of affording the joy of singing to people across generations

Japanese customers of all gender and ages as well as foreign inboundand for all occasions, we have expanded our product lineup including

customers to experience a level of excitement from karaoke beyond what

the flagship LIVE DAM AiR series, Cyber DAM for the nighttime market,

they had previously imagined. By so doing, we are confident that we can

FREE DAM for the seniors’ market, and Party DAM for banquet halls, whilefurther expand our market share.

Now that the dust appears to have settled following the COVID-19

establishing solid footing in the industry.
scope of our business is broad and includes the development of karaoke

C o n t i n u i n g t o b e d r i v e n by o u r c o r p o ra t e m e s s a g e,
“Singing as we go”

machines and Denmoku devices, as well as microphones, amplifiers,

Since its introduction three decades ago, karaoke system has continued

speakers, and other peripherals, and network systems, in addition toits evolution, staying a step ahead of technological innovation. That ismusic distribution operations and consumer business.

why we in the Development Headquarters are engaged in R&D related

The Development Headquarters plays a role in this process. The

The Development Headquarters is often regarded as a technology-

to technologies including acoustic technology, cloud technology, voiceoriented entity. What we bear in mind, however, is that true technologicalrecognition, and recommendation technology, as well as technology

innovation only comes to fruition when we fulfill our customers’ endlesss u pp or t i n g m or e ad v anc ed s c or i ng . M eanw h i l e, t o k eep a b r e a st o fdesire to derive more enjoyment and pleasure from singing. It is importantthe newest technological trends and apply them to new products andto us th a t we d o n o t b e c o m e c o m p l a c e n t s i m p l y b e c a u s e w e h av e

services, we conduct research jointly with companies, universities, andemployed cutting-edge technology, but instead to focus on customer

other institutions—in addition to the efforts of our in-house development

satisfaction.

staff—while experimenting with cutting-edge technologies including
ChatGPT and Metaverse to investigate the potential incorporation into

Leveraging the launch of LIVE DAM AiR to further enhancecustomer satisfaction and increase market sharenext-generation karaoke.
I certainly do not consider myself a good karaoke singer by any

The best part of karaoke is the joy everyone can experience of being ameans, but it is still uplifting to sing my favorite songs well. When you singhero or heroine for a moment. As such, there is no end to the demands

your best, and it goes well, everyone there reacts positively. In the interest

from our customers, starting from the upgrading of karaoke songs and liveof enabling an increasing number of people to experience this sense

images, to sound and image quality, and the precision, enjoyment, andof accomplishment, we will continue to do our utmost to create more

realism of scoring games. In the interest of responding to such desires toappealing products, with our corporate message, “Singing as we go” firmly

the maximum extent possible, we released LIVE DAM Ai in October 2019,in mind. So please look forward to it.

which unites AI technologies including voice recognition and advanced
acoustic technology. And, in April 2023, LIVE DAM AiR was born, offeringfunctionality that has been enhanced from its predecessor.
This new flagship model is replete with new features that have been
well received by LIVE DAM Ai users. These include Ai Assistant, whichmakes possible a voice-activated song reservation function; precisionscoring Ai that enables human sensitivity to actually be reflected in
the scoring, and live sound that reproduces concert hall-level realism.
Moreover, to satisfy inbound demand, we offer Ai Assistant in multiple
languages. And the sound incorporates simulated audience cheering andcall-and-response to simulate a live concert hall experience.

Key points of LIVE DAM AiR
Further enhancement of Ai AssistantIn addition to facilitating the use of “Speak and Request a song”
by displaying a list of candidate songs, “Moshi-moshi, DAM!”
supports speech in English, Korean, and Chinese.
More diverse sound quality space
We h a v e r e c e n t l y a d d e d t w o n e w f e a t u r e s t o o u r l i v e s o u n dselection—Saitama Super Arena, where many anime-related
l i v e per f or m anc es ar e al s o h el d, an d Ex c i t e Li v e H all , w h i challows users to experience being a performer in front of a live
audience.

CLOSE-UP
LIVE DAM AiR

Implemented Southern All Stars x Singing Special Campaign!
We have been developing a number of projects in collaboration with
Southern All Stars—who celebrated their 45th anniversary in 2023—aspart of the Southern All Stars x Singing Special Campaign.
In addition to the exclusive distribution of the actual artist’s videoof “Bongiri Koiuta,” in commemoration of “Chigasaki Live 2023,” theDAM karaoke system is exclusively offering a treasured live video of thelegendary outdoor live performance “SUPER SUMMER LIVE 2013 ‘Scorching
Mampi!! G

Spot Unleashed!!’” held at Chigasaki Park Baseball Ground,through its “LIVIEW!” content that delivers powerful live video.
Moreover, DAM “Singing” 2023 Special Project, a TV commercial
featuring Southern All Stars, is airing nationwide.
We have teamed up with Southern All Starst o d ev el op a h os t of m eas ur es t o en hanc e t heenjoyment of karaoke for all.

Southern All Stars x Singing Special Campaign

https://www.clubdam.com/campaign/collaboration/202307_bb_southernallstars.html

BIG ECHO’s latest initiatives

Campaign celebrates 35th anniversary of BIG ECHOBIG ECHO celebrated its 35th anniversary on September 14, 2023.
In April, we launched Good Company Room Project, a collaborative
project with businesses to express our gratitude to our suppliers for theirsupport. And, in September, we held a large-scale festival with a coupon
raffle draw at the store to show our appreciation to everyone.
In addition, the BIG ECHO Karaoke Grand Prix will be held to determine
the top karaoke singer. A tentative total of fourteen teams will be selectedfrom preliminary entries received between September 14 and November
30, 2023, and the final competition will take place at MARUNOUCHI BASE
in Tokyo on January 20, 2024.
In addition to bolstering facilities through the early introduction of thelatest models, we will launch a host of measures to attempt to recover thecustomer base that had not been able to take part in karaoke due to the
COVID-19 pandemic.

NEWS DIGEST
Develop new customer needs through new brand development
A restaurant chain operated by the DAIICHIKOSHO Group, DK Dining
offers nearly 30 different brands. These encompass everything fromprivate dining rooms, restaurant/bars, and traditional bars to dart bars
and dining establishments, primarily in proximity to train stations incentral Tokyo.
We are promoting the development of new brands to meet the newneeds of various customers, and in October 2023, we opened FOREST
DINER in Sapporo, Hokkaido. The restaurant features American-stylecuisine and domestic and international draft beers. Then, in November,
we opened Sushi To Sake Biyori Totouo in Akihabara, Tokyo, where
guests can enjoy our special sushi and a wide range of snacks in modern
Japanese-style private rooms.
We intend to launch more new brands under DK Dining in the future.

FOREST DINER
Sapporo branch
Opened on October 25, 2023

Parking business THE PARK
Leveraging our community-based karaoke sales
network, we are promoting our coin parking businessunder the name THE PARK. New store openings haveprogressed well, expanding the scale of the businessto more than 2,300 facilities and 28,000 parking
spaces as of September 30, 2023. In the current
fiscal year, we worked to enhance recognition of
THE PARK when it comes to land utilization, throughmeans such as TV commercials targeting landowners. We will continue to grow this brand as one of
the DAIICHIKOSHO Group’s new pillars.

Trends of number of facilities and number of parking spaces■ Number of parking spaces (right axis)● Number of facilities (left axis)

2,500

25,0001,500

15,000

500

5,000

0

0
2015

2016

2017

2018

2019

2020

2021 2022/9 2023/3 2023/9

DK ELDER SYSTEMFREE DAM LIFE, the latest model dedicated to the DK ELDER SYSTEM, is equipped with Omakase Rec, afunction that automatically creates and plays progressive programs according to the categories of exercise,cognition, oral health, and singing. It also features a remote session function which, through simultaneous
pairing and remote operation, enables progressive programs to be shared with up to five facilities. The model
also offers a host of popular programs that are both fun and useful, including content developed based on
joint industry-academia research and content born from feedback obtained from actual users. We havereceived comments from staff members at the facilities that use the service, which include “We have seen an
increase in the number of people participating in our recreational programs” and “It has reduced our workloadin the midst of a labor shortage.”
Through the dissemination of the DK ELDER SYSTEM, the DAIICHIKOSHO Group will continue tocontribute to resolving mental and physical health—key social issues—through the power of songs andmusic, while also aiming for sustainable growth as a company that contributes to making peoples’ lives morecolorful, and society more affluent.

About the DK ELDER SYSTEM
The programs we have provided that allow people to use music and their bodies and see with their eyes,
have been recognized as being effective in maintaining and enhancing overall lifestyle functions including
exercise, oral health, and cognition. As of the end of September 2023, the DK ELDER SYSTEM has been
installed in over 26,000 elderly care facilities and municipal facilities nationwide.

Sushi To Sake Biyori Totouo
Akihabara Station branch
Opened on November 1, 2023

FINANCIAL HIGHLIGHTS
2022/32023/32024/3
Second quarter Fourth Quarter Second quarter Fourth Quarter Second quarter Fourth Quarter(Forecast)

Item
Operating results (Millions of yen)
Net sales
Operating profit
Operating profit to net sales (%)
Ordinary profit
Profit attributable to owners of parent
Financial position (Millions of yen)
Total assets
Net assets
Cash flows (Millions of yen)
Net cash provided by operating activities
Net cash used in investing activities
Net cash used in financing activities
Cash and cash equivalents at the end of period
Per share data (Yen)*
Basic earnings per share
Net assets per share
Dividend per share (interim/year-end)

39,529△ 1,945△ 4.9△ 1,176△ 1,429

94,787
△ 289
△ 0.3
888
5,196

60,671
5,469
9.0
5,773
5,990

128,156
12,95410.1
13,601
8,320

71,256
9,377
13.2
9,758
6,576

144,500
18,00012.5
19,10012,700176,804
101,733

180,389
105,160

184,480
108,286

188,623
107,915

174,219
105,860−−△ 1,606△ 5,049△ 3,31457,715

18,165△ 9,297△ 8,487
68,125

11,367△ 5,901△ 3,500
70,124

24,869△ 12,104△ 9,493
71,423

9,446△ 9,676△ 19,450
51,810−−−−△ 13.10917.3856.00

47.61
948.3357.00

54.86
976.51
56.00

76.21
974.9557.00

60.91
976.5828.00

118.85
−
29.00

−
−
56.7
−

0.5
5.0
57.4
118.7

−
−
57.8
−

7.4
7.9
56.4
74.1

−
−
59.9
−

−
−
−
48.0

Major management indicators (%)
Ordinary profit to total assets (ROA)
Return on equity (ROE)
Equity ratio
Payout ratio* S hares were split on April 1, 2023 at a ratio of 2 for 1 common share. Basic earnings per share and net assets per share are calculated as if said split had been carried out at the beginning of the fiscal year ended March 31, 2022, and dividend per share for the fiscal years ended March 31,
2022 and March 31, 2023 is the actual dividend amount prior to said split.

Net sales (Millions of yen)
Second quarter

Operating profit (Millions of yen)

Fourth Quarter

Second quarter

144,500

Fourth Quarter

Second quarter

18,000(Forecast)

Fourth Quarter

12,700(Forecast)

128,156(Forecast)

12,954

94,78760,671

Profit attributable to owners of parent (Millions of yen)

9,377

71,256

5,990

5,196

5,469

8,320

6,576

△289

39,529△1,9452022/32023/32024/32022/32023/3△1,4292024/32022/32023/32024/3

Overview by Segment

42.8%

Commercial Karaoke
Business

43.1%

Karaoke Room andRestaurant Business

30,483 百万円
Operating profit
6,947 百万円

30,685 百万円
Operating profit
2,680 百万円

Net sales (Millions of yen)

Net sales (Millions of yen)

Net sales

Second quarter

Fourth Quarter

Operating profit (Millions of yen)
Second quarter

7,472
2024/32023/3

Fourth Quarter

Operating profit (Millions of yen)
Second quarter

22,7022024/3L aunched new flagship model LIVE DAM AiR in April
2023, shipped more units than originally plannedS o u g h t t o s t r e n g t h e n t h e s t a b l e p r o f i t b a s e b y
increasing the number of equipment rentals andexpediting the replacement of previous models withnewer ones
Strived to improve our Karaoke DAM products by further
expanding our visual content, including live, animated,and music videosI n the seniors’ market, strived to increase the numberof units in operation, as the number of facilities allowing
sales visits increased; utilized web as wellN et sales increased owing to strong shipments andsteady increases in the number of equipment rentals andDAM units in operation, while operating profit decreased
due to an increase in costs related to equipment rentals
and in selling, general and administrative expenses.

2023/3

Fourth Quarter

2,680
30,685

6,947

30,48328,716

Second quarter

51,584

13,59357,7312023/3

Fourth Quarter

Net sales△59

2023/3

Music Software Business

3,169 百万円
Operating profit
156百万円Net sales

Net sales (Millions of yen)
Second quarter

Fourth Quarter

Operating profit (Millions of yen)
Second quarter

3,221
2024/3K araoke: 3 stores opened, 2 stores closed, 509 storesas of end of current period Restaurant: 5 stores opened,
9 stores closed, 167 stores as of end of current periodD ue to the downgrading of the status of the COVID-19’s infectious
disease classification in May 2023, we have seen a recovery trend in
the flow of customers since the beginning of the period.
Existing stores compared with pre COVID-19: Karaoke stores 90%,
Restaurants 110%
Existing stores year on year: Karaoke stores 130%, Restaurants 140%
B IG ECHO karaoke stores: Endeavored to increase customers
visiting the stores through measures to make the 35th
anniversary more exciting, while introducing the top-end
model early in an effort to improve customer satisfaction.
F or restaurants, we made efforts to increase customer
traffic in a wide-ranging manner by, for example,
strengthening the securing of banquet reservations andopening three stores in the darts business.

2023/3

Fourth Quarter2023/3

Other Businesses

6,917 百万円
Operating profit
795 百万円

Net sales

Net sales (Millions of yen)
Second quarter

156

Fourth Quarter2024/3P roduct sales of CDs and DVDs and the TV
program production business progressed
nearly as planned, as the music industry has
been booming again as events and concerts
have resumed.

Operating profit (Millions of yen)
Second quarter

6,917

2023/3

Fourth Quarter

1,581

6,030

98
2024/3

9.7%

12,411

228

6,430
3,169

△1,6712024/3

4.4%

795
788

2024/32023/32024/3T h e p a r k i n g b u s i n e s s , w h i c h i s b e i n g
promoted as a new earnings pillar, performed
well, and the business scale expanded toabout 2,300 facilities and 28,000 parking
spaces as of the end of current period.
We strived to expand recognition of The Park
brand through TV commercials targeting landowners.

PICK UP! ARTIST Profiles of the DAIICHIKOSHO Group’s artists
J-POP

J-POP

BERRY GOODMAN

Jams Collection

Their power songs (fight songs), which areconsidered synonymous with the group, haveb een used as the entrance th e me b y a n u mb e rof Japanese professional baseball players.
Additionally, students who work hard at school andclub activities, as well as families struggling withwork and household chores, have found their songs
tremendously relatable.
In 2023, the year during which BERRYGOODMAN celebrated the 10th anniversary of its formation, they were appointed as anambassador (artist) for the Hanshin Koshien Stadium 100th Anniversary Project and will
be holding a one-man live concert at Hanshin Koshien Stadium in November, which thegroup had set as their dream. The group is increasingly gaining momentum.

Jams Collection is a group comprising all female
members, and made its stage debut on March 3,2021. Their popularity has increased exponentiallyf ro m t h e i r f i rs t p e rf o rm a n c e — s o m u c h s o t h a tthey now perform on the main stage at major idol
festivals such as @JAM and TOKYO IDOL FESTIVAL.
In June 2023, the group evolved into its strongestever iteration, growing to eight members with theadditions of Ruka Okonogi and Yume Oba.
In October 2023, the group performed as the sole act for the sixth time at the“JamsEvolution!!!!!!!!! ~Makuhari de ‘Cho’ Wakimasse~” event at the International
Exhibition Hall of Makuhari Messe. The event was tremendously successful, leading to
the group attracting even more attention.

CORPORATE INFORMATION (as of September 30, 2023)
Corporate Profile

Executive Officers

Corporate name

DAIICHIKOSHO CO., LTD.

Established

April 16, 1973

Capital12,350 million yen

Number of
employees

Parent: 1,911
Group: 3,367

Description of main Commercial karaoke business, karaoke room and restaurant
businesses
business, music software business and other businesses
Consolidated
subsidiaries

Domestic sales subsidiaries: 25 companies
Other domestic subsidiaries: 11 companies
Overseas subsidiaries: 2 companies

Number of authorized shares

400,000,000 shares

Number of outstanding shares

109,468,400 shares

Director (outside)

Miki Kashizaki

Director

Harutoshi Hoshi

Corporate Auditor(standing, outside)

Hiroshi Umetsu

Director

Kenji Otsuka

Corporate Auditor(standing)

Fumiaki Koizumi

DirectorTakeshi Iijima

Corporate Auditor(outside)

Masumi Arichika

Director (outside)

Katsuya Taruishi

Corporate Auditor(part-time)

Hiroyoshi Shibano■ Individual shareholders and others 42.07%■ Financial instruments business operators 0.80%■ Business companies and other corporations 9.06%

25,413

Number of shareholders■ Foreign companies and individuals 26.30%■ Financial institutions 21.77%

Shareholder Special Benefits

Major Shareholders
Number of shares held(Thousands of shares)

Shareholders recorded in the final shareholder registry on September 30, 2022 as holding 200
or more shares will be granted special benefits coupons according to the number of shares held.

Shareholding ratio(%)

The Master Trust Bank of Japan, Ltd.
(Trust account)

14,314

13.40

Tadahiro Hoshi

12,492

11.69

Harutoshi Hoshi

Tadahiro Hoshi

Shareholding Ratio by Category

Status of the Shares

Name of shareholder

President

12,239Details of benefits

11.45

JP MORGAN CHASE BANK 380055

5,858

5.48

Hoshi Create Co., Ltd.

4,899

4.59

Issued semiannually
Special benefits coupon (*1)

Exchange with CD(s) (*2)

200 to 1,999 shares

Ten sheets of
500-yen coupon

1 CD

2,000 shares or more

25 sheets of
500-yen coupon

2 CDs

Number of shares held(*1) T he coupons can be used at BIG ECHO and KARAOKE MAC karaoke rooms and restaurants operated by the DAIICHIKOSHO Group
including RAKUZO, UMEKO-NO-IE, and JIBUNDOKI.
(*2) C D albums are granted in exchange for total face value of coupons held.

Timing of delivery On or after December 4, 2023
Validity period

January 1, 2024 to June 30, 2024

* Shareholding ratio is calculated after deducting 2,616 thousand treasury shares.

Information for Shareholders
Business term

From April 1 of each year to March 31 of the following year

Ordinary General Meeting of Shareholders

June of each year

Record date for the above

Ordinary General Meeting of Shareholders: March 31
Other occasions: Other record date separately determined asnecessary upon a public notice

Record date of shareholders toreceive dividends from surplus

Year-end dividend: March 31
Interim dividend: September 30

Number of shares constituting one unit

100 shares

Electronic public notice

Method of public notice

If it is impracticable to provide an electronic public notice because of an accident or any
other unavoidable reason, a public notice will be provided in the Nihon Keizai Shimbun.

Transfer agent and account management
institution for the special account

Mitsubishi UFJ Trust and Banking Corporation

Mitsubishi UFJ Trust and Banking Corporation
Corporate Agency Division
1-1 Nikko-cho, Fuchu-shi, Tokyo
Telephone: 0120-232-711 (toll-free in Japan only)
Contact of above
Postal address:(postal address and telephone number)
Mitsubishi UFJ Trust and Banking Corporation
Corporate Agency Division
Shin-Tokyo Post Office, PO Box No. 29,
137-8081, Japan

Location: 5-5-26 Kitashinagawa, Shinagawa-ku, Tokyo 141-8701, Japan
Telephone: +81-3-3280-2151 (switchboard)