Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)
Issued: 6/5/2023● SummaryAlpha-Win Capital Inc. Research Dept.
https://www.awincap.com/

Business Description
・ YRGLM Inc. (hereinafter referred to as the “Company”) plans, develops, and sells software related to Internet
marketing. It is listed on the Growth Market of the Tokyo Stock Exchange. Its president, Susumu Iwata, started thebusiness as a college student and founded the Company in 2001.
・Its main product is its originally-developed Internet ad effectiveness measurement system (AD EBiS), which has anincredibly high market share (top share in the market). While small in scale, it is a leading company in a niche field.
・Its strengths are its technological capability enabling highly accurate data measurement, employees with DX
expertise, the big data that it has accumulated as the frontrunner in the field, and its network with more than 500
corporate partners.
・As its main business, it provides cloud services to mid-tier and large companies, based on a subscription-based
business model. Therefore, its business is highly maintainable, stable, and profitable.
・Since 2016, it had been working on a business model shift and the selection/focus of its business portfolio. Thisbusiness restructuring has already come to an end of a phase and has improved its business foundation and earning
power. Currently, the Company is developing two segments of business, the Marketing PF (platform) and the EC PF.
It has been steadily laying the groundwork for growth by conducting M&As for both business segments.
・At least since FY2010 through the previous fiscal year (note that the Company’s fiscal years are September-ending;e.g., FY2010 ended in September 2010), the Company has been hitting record-high sales for 13 consecutive fiscal
years (including the period of non-consolidated financial results). From FY2020 onwards, it has continued to stably
post a profit and has been generally increasing dividends.
This Fiscal Year’s First-Half Results and Financial Forecast for This Fiscal Year・Consolidated financial results for the first half of the current fiscal year (first half or “H1” of FY2023: cumulative
results through the second quarter or from October 2022 to March 2023) were as follows: sales increased by 14.6%
YoY to Y1,812 million, operating profit increased by 19.2% YoY to Y210 million, and net profit rose by 25.5%
YoY to Y131 million. Sales and profits increased at double-digit rates. Although the Company did not disclose its
preliminary forecasts for the first half of this fiscal year, while significant progress was made for both sales andprofits in the first half in terms of achieving the full-year forecasts made at the beginning of the fiscal year, they haveboth been presumably slightly lower than the Company’s internal plan.
・The Marketing PF’s sales (to external customers; the same applies hereinafter) were Y1,492 million (+5.0% YoY)
and its profit was Y158 million (+10.3% YoY), while the EC PF’s sales were Y320 million (+98.3% YoY) and its
profit was Y54 million (+61.8% YoY). Sales and profit grew for both platforms.
・In the Marketing PF segment, although the unit price of its core product AD EBiS increased for the 20th consecutive
quarter (YoY), the amount and rate of increase have decreased. The acquisition of new customers has also been
below expectations and the churn rate has stayed around 2.4% since Q4 FY2022. As a result, the sales of theadvertising effectiveness measurement business have slightly decreased.
・On the other hand, these negative factors were offset by the significant sales growth of the incubation businesses,
thanks to the expansion of its originally developed service AD HOOP’s business domain and contribution by thethree acquired subsidiaries. In terms of profit, the amount of loss posted for the incubation businesses has improvedand costs associated with office relocation have decreased, which contributed to the increase in profit.
・In the EC PF, it received orders for large-scale projects. Sales and profit growth of the e-commerce website building& operation support, mainly owing to the acquired company BOKUBLOCK, contributed to the results.

・In terms of its financial position, the Company has continued to be essentially debt-free, having accumulated capital(through its profits) and cash & deposits. The equity ratio and current ratio are at sufficient levels, and its financial
standing is sound.
1/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or
fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from theuse of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

・At the beginning of the fiscal year, the Company had expected sales and profit growths as well as record profit forthis fiscal year as well. However, given the struggles in the first half with acquiring new customers for its highly
profitable business AD EBiS, it has revised downward its full-year forecast. It revised sales from Y3,900 million(+17.0% YoY) ⇒ Y3,600-3,700 million (+8.0% to +11.0% YoY), operating profit from Y400 million (+1.9% YoY)
⇒ Y280-330 million (-16.0% to -28.7% YoY), and net profit from Y240 million (+1.7% YoY) ⇒ Y170-200 million(-15.3% to -28.0% YoY). Although the Company still expects to achieve sales growth and hit record-high sales, it
now expects profit to decline.
・Since the Company’s goal for the consolidated dividend on equity ratio (DOE) is 2.5% for this fiscal year, it revised
down its annual dividend per share from 7.8 yen ⇒ 7.4 yen in line with the downward revision of profit. However, it
is still increasing dividend by +0.4 yen compared to the previous fiscal year’s dividend of 7.0 yen.
・Alpha-Win Research Department had forecast sales of Y3,800 million, which was Y100 million smaller than the
Company’s initial forecast, and operating profit of Y400 million, which was the same as the Company’s forecast.
However, the Company’s revised forecasts are now smaller than these forecasts. We had previously evaluated thateven if sales became smaller than expected, the Company had room for cost adjustment so that it could achieve thelevel of profit that we had forecasted through cost control. However, the fact that AD EBiS’s number of accounts had
decreased more than expected and that the Company has continued to strengthen development investments for future
growth seem to have caused the difference between our forecast and the Company’s.
・Considering the estimates used in the Company’s new plan and the current situation, we also revised our full-year
forecasts downward to the same level as the Company’s forecasts. Our new forecasts are sales of Y3,650 million(same as the average of the Company’s planned range), operating profit of Y310 million (similarly, +Y5 million
compared to the Company’s average), and dividend of 7.4 yen (same as the Company’s forecast).
・The Company’s plan for the second half of this fiscal year (calculated by subtracting the first-half results from theaverage of the full-year forecasts) is sales of Y1,838 million (+4.8% compared to the previous fiscal year’s secondhalf), operating profit of Y95 million (similarly, -56.2%), and net profit of Y54 million (similarly, -59.1%). It expects
a slight increase in sales and a large decrease in profit. Compared to this fiscal year’s first-half results, too, it isforecasting a slight increase in sales (+1.4%) but a large decrease in profit (operating profit: -54.8%), due to theincrease in costs and deterioration of profit margins. We believe that these forecasts may be somewhat conservative.

Business Strategy and Medium-Term Financial Forecast
・In addition to increasing the sales of its core product, it has been working on its strategy to achieve continuous growthby developing related or new businesses in which synergy can be expected and contributing to its customers’ DX
through its PF businesses. It also plans to accelerate business growth by actively pursuing M&As and building
alliances with other companies.
・Although it has not specified the specific schedule, it plans to achieve Y10 billion in consolidated sales as a corporategroup of comprehensive marketing DX support. It plans to achieve this goal through the stable growth of its
conventional businesses (ad effectiveness measurement, advertising agency DX, and EC-CUBE) over the medium
term and by creating new growth drivers through the expansion of new services in three areas (incubation, ecommerce website building & operation support, and marketing process support).
・Internet marketing, on which the Company is concentrating its management resources, as well as the e-commerce
related areas, has a high market growth potential over the medium to long term. Furthermore, since the Company’s
policy is to actively pursue M&As as part of its growth strategy, it is expected to maintain a double-digit annual sales
growth (on average).
・While profits will be impacted by the amount of investment in development since the Company is in its growthphase, the balance between profits and costs is a key point in management. Currently, it is in the stage of making
upfront investments toward achieving high growth in the future. Once the current upfront investments peak out, we
believe that it will return to an upward profit trend due to increased sales and improved profit margins brought by the
expansion of its conventional and new businesses in both business segments. Regarding the financial forecasts for
FY2024 and FY2025, we have reviewed our previous forecasts and made downward revisions mainly concerning
AD EBiS, but we still expect increases in sales, profits, and dividends.

2/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or
fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from theuse of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

Stock Price
・The stock price has fallen in response to the downward revision of the full-year financial forecast at the time of theannouncement of the financial results for the first half. The price is currently adjusting to the lowest price range since
becoming listed on the market.
・Recognized as a domestic-demand-oriented growth stock related to ad-tech/subscription businesses, a certain levelof evaluation is presumably already factored into the stock price. We believe the key valuation indicators are withinreasonable ranges, considering the new forecasts for this fiscal year. In the future, the stock price is expected tochange in response to the level of profit and dividend.
・In the medium to long term, the DOE could be reasonably raised, and dividend hikes are expected along with theprofit growth. Dividend trends and the return of profit to shareholders, such as share buybacks, will also be some of
the key points.
・The new services are expected to become the future growth drivers, and whether they will succeed will be a major
factor impacting future business performance. Considering the medium-term growth potential for the profits and thepossibility of future dividend hikes, we believe the stock price has the potential to rise over the medium to long term.
・The key factors impacting the stock price will mostly likely continue to be AD EBiS’s number of accounts and unit
price; AD EBiS’s churn rate and the sales proportion of the new services, which are KPIs; monthly sales trends (MoM
for both PF segments); quarterly trends in profit/loss; the financial results for this full fiscal year; forecasted profit
levels for the next fiscal year onwards (the timing of the rebound to profit growth); measures to return profit toshareholders and their scale; and announcements of M&As and tie-ups.
【3690 YRGLM Inc.

Sector: Information & Communication 】

FY

Figure A

Sales

YoY

O.P.

YoY

R.P.

YoY

N.P.

YoY

EPS

BPS

Dividend(million Y)(%)(million Y)(%)(million Y)(%)(million Y)

(%)

(Y)

(Y)

(Y)

2020

A

2,618

18.8

276

226.1

261

230.5

183

To profit

29.1

202.2

4.0

2021

A

2,957

12.9

365

32.0

364

39.5

239

30.7

38.0

257.5

5.2

2022

A

3,334

12.7

392

7.4

399

9.8

236

-1.5

37.7

283.3

7.0

5,000

-

750

2023

OPM = 15% (old) ⇒ 10% (new)-DOE = 3.0% (old) ⇒ 2.5% (new)2023

Initial CE

3,900

17.0

400

1.9

390

-2.5

240

1.7

38.3

-

7.8

2023

New CE average

3,650

9.5

305

-22.4

305

-23.8

185

-21.7

29.5

-

7.4

New CE min.

3,600

8.0

280

-28.7

280

-30.0

170

-28.0

27.1

-

7.4

New CE max.

3,700

11.0

330

-16.0

330

-17.5

200

-15.3

31.9

-

7.4

2023

New E

3,650

9.5

310

-20.9

310

-22.3

190

-19.5

30.2

305.4

7.4

2023

Old E (previous)

3,800

14.0

400

2.0

390

-2.3

240

1.7

38.2

314.6

7.8

2024

New E

4,000

9.6

330

6.5

330

6.5

200

5.3

31.8

329.8

8.3

2024

Old E (previous)

4,320

13.7

460

15.0

450

15.4

300

25.0

47.9

354.7

8.9

2025

New E

4,350

8.7

365

10.6

365

10.6

220

10.0

35.0

356.5

8.9

2025

Old E (previous)

5,000

15.7

530

15.2

520

15.6

340

13.3

54.3

400.1

10.0

2022

Q1 A

776

7.6

87

-7.1

87

-8.2

58

-5.1

9.3

249.1

0.0

2023

Q1 A

879

13.2

97

10.8

102

16.7

69

18.4

11.1

285.9

0.0

2022

Q2 A

805

8.1

89

5.3

89

8.2

46

-16.5

7.4

2023

Q2 A

933

16.0

113

27.5

110

24.5

62

34.6

9.9

2022

H1 A

1,581

7.8

176

-1.3

176

-0.6

104

-10.5

16.7

260.3

0.0

2023

H1 A

1,812

14.6

210

19.2

212

20.7

131

25.5

20.9

297.4

0.0

2022

H2 A

1,753

17.5

216

15.8

223

19.6

132

7.1

21.0

7.0

2023

H2 CE

1,838

4.8

95

-56.2

93

-58.7

54

-59.1

8.5

7.4

0.0
0.0

(Note) “Old”: initial forecast at the beginning of the fiscal year or the previous forecast. “New”: revised forecast for this fiscal year. “A”:
actual results. “CE”: the Company’s estimate (forecast). “E”: estimate (forecast) by Alpha-Win Research Dept. “FY2023 New CE
average”: averages of the Company’s forecasted ranges for sales (3,600 to 3,700 million yen), operating profit (280 to 330 millionyen), recurring profit (280 to 330 million yen), and net profit (170 to 200 million yen). “Q1”: Oct-Dec. “Q2”: Jan-Mar. “H1” (firsthalf): Oct-Mar. “H2” (second half): Apr-Sept. Note that the Company’s fiscal year is September-ending. For example, FY2023 ends
in Sept. 2023.

【 Stock Price and Valuation Indicators: 3690 YRGLM Inc.】
Item

Figure B
Dividend Yield

Dividend Payout Ratio

585

Last FY (actual)

15.5

2.1

1.2%

18.6%

Shares Outstanding (thou.)

6,372This FY (est.)

19.3

1.9

1.3%

24.5%

Market Capitalization (million Y)

3,728

Next FY (est.)

18.4

1.8

1.4%

26.1%

0.0

Equity Ratio at End of This First Half

Stock Price (Y)Dilutive Shares (thou.)

5/31/2023

Item

P/E

P/B

59.3% Last FY's ROE

13.9%(Note) Forecasts/estimates were made by Alpha-Win Research Dept.

3/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or
fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from theuse of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18【 Stock Chart (end-of-week prices): 3690 YRGLM Inc.】 Figure C
(Y)

3,000

1.20
Stock price (left axis)
Price relative to TOPIX (right axis)

2,500

1.10
1.00
0.90

2,000

0.80
0.70

1,500

0.60
0.50

1,000

0.40
0.30
7

7

8

8

9

9

0

0

1

1

2

2

3

08
/1

02
/1

08
/1

02
/1

08
/1

02
/2

08
/2

02
/2

08
/2

02
/2

08
/2

02
/2

(Note) From the fourth week of Aug 2016 to the closing price on May 31, 2023

(M
M
/Y
Y)

6

02
/1

0.20

08
/1

500

【Performance】
PeriodReturnvs. TOPIX
1 month-7.6%-10.8%
3 months-10.8%-16.6%
6 months-15.1%-20.9%
12 months-22.4%-30.4%(Note) Prepared by Alpha-Win Research
Dept. Reflects stock price and TOPIX
values through the closing price on
5/31/2023 (most recent value). In thecalculation of performance for each period,
the stock price and TOPIX at the end of thelast month of each period were comparedwith their most recent values. For example,
the performance during the 1-month period
is the comparison between the closing priceon the last day of April and on May 31.
Similar for the rest.

Note: Values used in this Report, including its text and figures, may slightly differ from the same item disclosed by the Company or
shown in this Report since the values may have been rounded, may have gone through various calculation processes with rounding to thenearest unit, or may be displayed in different formats.

＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊＊

Disclaimer
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc.
(hereinafter “Alpha-Win”) on the request of the company presented in this Report.
This Report is not to be construed as a recommendation or solicitation of investment. Alpha-Win shall not beliable for any consequences including direct or indirect loss, lost profit, or damage resulting from the use of or
reliance on this Report. Investors who read this report must make their own decisions on all investment
matters and take full responsibility regarding their investment.
This Report has been prepared with a focus on objectivity and neutrality based on the analysis of generally accessible
public information and supplemental information including interview(s) by the analyst. Alpha-Win, the writer,
and/or other persons involved in the publication of this Report may already hold, or buy and sell in the future, thestock of the company presented in this Report.
Contents of this Report are based on information current as of the issue date and are subject to change
without notice. For the latest (updated) report, please see our website (https://www.awincap.com/). We also do
not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or fit
for any purpose and do not accept any responsibility or liability.
Copyright of this Report belongs to Alpha-Win and no part of the publication may be copied, photocopied, cited,or translated without our consent.
For inquiries regarding this Report, please send us an e-mail to info@awincap.com. However, Alpha-Win and thewriter of this Report do not have any obligation to reply to inquiries.
MV2023-0606-20000

4/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented in thisReport for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are based on
information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete, appropriate, or
fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage resulting from theuse of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding their investment. Intellectual
property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

Contents
1．Company Overview ........................................................................................................................ P6
A Leading Company in a Niche Market ............................................................................................ P6
2．Business Contents and Business Model ........................................................................................ P8
Business Portfolio .............................................................................................................................. P8
Business Details: I. Marketing PF* Segment ..................................................................................... P9
Business Details: II. EC PF* Segment ............................................................................................. P12
3．Shareholder Composition ............................................................................................................ P14
Major Shareholder Composition ..................................................................................................... P14
4．History of Growth ......................................................................................................................... P15
Past Transition in Financial Results ................................................................................................ P15
5．Market Environment .................................................................................................................... P16
Trends of Japan’s Advertising Market ............................................................................................ P16
6．This Fiscal Year’s First-Half Results and Full-Year Forecast ................................................. P17
Results for Q2 FY2023 (first half) .................................................................................................... P17
The Company’s Financial Forecast for FY2023 (full year / second half) ......................................... P21
Alpha-Win Research Dept.’s Financial Forecast for FY2023 (full year).......................................... P25
7．Growth Strategy ............................................................................................................................ P27
The Company’s Medium- to Long-Term Business Plan and Strategy ............................................ P27
Alpha-Win Research Dept.’s Forecast of Financial Results over the Medium Term ..................... P29
8．Analyst’s View ............................................................................................................................... P31
Shareholder Return .......................................................................................................................... P31
Stock Price, Trends, and Factors that May Affect Stock Price ....................................................... P31(Notes)・Values used in this report have generally been rounded to the nearest unit and may therefore slightly differ from theCompany’s official disclosed values and other values.
*PF stands for “platform.”
・On June 30, 2023, the name of the consolidated subsidiary BOKUBLOCK INC. is planned to be changed to EC-CUBE
Innovations Inc. (the subsidiary which works on various solutions related to e-commerce).
・Upon translating to English, when the page numbers differed from the original Japanese version, they were adjusted tothose of the English version of this Report. Note that the Company’s fiscal year is September-ending (i.e. FY2023 ends
in September 2023).

5/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

1. Company Overview
w A company in the businessof marketing DX support.
Top share in the Japanesesoftware market for Internet
ad effectivenessmeasurement and opensource e-commerce website
building.
(1) DX (Digital
Transformation)：transformationand innovations of businesses
and lifestyles using digitaltechnologies(2) Internet advertising
effectiveness measurement tool:
Tool for comprehensively
measuring and evaluating theeffect of various Internet ads and
SEO strategies.
(3) Open source: The source
code, which is basically the
blueprint of software, is madeavailable free of charge, allowing
anyone to revise and redistributeit.
(4) SaaS (software as a service):
A service in which software isused via the Internet (mostly
synonymous with the cloud).
Does not need purchasing of
packaged products. Only thenecessary functions, contents,
and quantity of service are used
via the Internet and paid for.

w Ambitiously developing

new businesses throughM&As. Currently, its main
service is its SaaS (cloud) forInternet ad effectivenessmeasurement. Evolving into
a corporate group ofcomprehensive marketing
DX support through M&As
and in-house development.

w Founded by its president
Susumu Iwata. Currently
listed on the TSE GrowthMarket.
w The Company’s group iscomposed of eightcompanies including theCompany.

◆ A Leading Company in a Niche Market
Company Overview
YRGLM Inc. (hereinafter referred to as the “Company”) is a company in thebusiness of providing marketing DX1 support. It plans, develops, and sells
software related to Internet advertising and e-commerce.
Under its vision to “become a company that supports corporate marketing
activities around the world through data and technology to bring happiness toboth the sellers and the buyers,” the Company has grown its business rapidly
through its originally developed software. It has the top market share withboth AD EBiS, its Internet advertising effectiveness measurement tool2, and
EC-CUBE, its open-source3 software series for building e-commerce
websites. It is a leading company in a niche field.
Currently, its main service is its Internet advertising effectivenessmeasurement system, provided as a SaaS4 (cloud service). However, it has
been evolving into a corporate group of comprehensive marketing DX
support through active engagement in M&As in addition to in-housedevelopment.

History
Susumu Iwata, the Company’s president, started a web design business inOsaka as a college student. Following business expansion, he established theCompany in 2001. The Company became listed on the TSE Mothers Market
in September 2014 (now called the TSE Growth Market). It currently has two
main offices, one in Osaka and one in Tokyo.
Change in the Company Name
In August 2019, the Company changed its name from the previous LOCKON
CO., LTD., to YRGLM Inc.
Consolidated Companies and Trends in Consolidated Results
The YRGLM Group consists of a total of eight companies: the Company, its
six consolidated subsidiaries (EC-CUBE Co., Ltd., YRGLM VIETNAM Co.,
Ltd., and the four acquired companies Spoo! Inc., TOPICA Inc., Far End
Technologies Corporation, and BOKUBLOCK INC.), and one equity method
affiliate (SAI Co., Ltd.).
During FY2019 (note that the Company’s fiscal year is September-ending),
the EC-CUBE business was carved out of the parent company (became aconsolidated subsidiary after the carve-out). This caused changes in thebalance between the parent company’s results and the consolidated results.
Due to the profitability and solid financial performance of EC-CUBE Co.,
Ltd., sales growth and profit have been maintained for the consolidated
companies excluding the parent (consolidated minus parent company) since
FY2019 (Figure 1 on page 7).
The subsidiaries, which have become included in the consolidated results
upon their acquisition, have expanded their business after the acquisition andhave been contributing to the Group’s sales growth. Currently, allsubsidiaries seem to be maintaining a profit, but significant contribution to
the Group’s profit should start to be seen in the next fiscal year or later. Note
6/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

that the actual numerical results of the parent company alone have not been
disclosed for the first half.

【Figure 1】Comparison of Consolidated vs. Parent Company’s Sales and Recurring Profit by Fiscal Year
(Units: million yen and %)Unit: million yen, %A
Consolidated sales
B
Parent company sales
A-B＝C
Consolidated sales - parent company sales
A/B
Consolidated sales / parent company sales
A
Consolidated R.P.
B
Parent company R.P.
A-B＝C
Consolidated R.P. - parent company R.P.
A/B
Consolidated R.P. / parent company R.P.

FY2014
1,360
1,360
0
1.00
233.6
245.2
-12
0.95

FY2015
1,437
1,437
0
1.00
352.0
359.0
-7
0.98

FY2016
1,613
1,613
0
1.00
250.3
252.1
-2
0.99

FY2017
1,719
1,719
0
1.00
106.3
106.8
-1
1.00

FY2018
1,804
1,804
0
1.00
-115
-110
-5
-

FY2019
2,204
2,010
194
1.10
79
19
60
4.16

FY2020
2,618
2,317
301
1.13
261
165
96
1.58

FY2021
2,957
2,532
425
1.17
364
278
86
1.31

FY2022
3,334
2,583
751
1.29
399
315
84
1.27

(Ref) Prepared by Alpha-Win Research Dept. based on the securities report(Note) Consolidated results starting in FY2014 (applies to the rest of this Report).

Financial StandingIts free cash flow (FCF) had been negative for some period due to M&As andlarge-scale investments, but since the second half of FY2020 the FCF has
been generally improving and the Company’s capital and cash & deposits
have been accumulating (Figure 2). As of the end of March 2023, its debt
totaled about Y750 million, while its cash & deposits were about Y1,410
million. Therefore, the Company is essentially debtless.

w As of the end of March
2023, it was essentiallydebtless, with cash &deposits exceeding its
amount of debt.

【Figure 2】Semi-Annual Change in Cash Flow and Balance of Cash & Deposits
Unit: million yen
Operating CF ①
Investing CF ②
Financing CF
FCF（①+②）
Cash and Deposits (on B/S)

FY2015
H2
15
148
-5
-27
-3
0
9
121
666
787

H1

FY2016
H2
48
93
-80
-69
-16
3
-32
24
738
762

H1

FY2017
H1
H2
121
23
-88
-106
-31
-0
33
-83
764
681

FY2018
H2
7
9
-94
-118
169
542
-88
-110
760
1,194

H1

FY2019
H2
99
109
-368
-158
162
-262
-269
-50
924
774

FY2020
H2
92
429
-409
-101
391
-56
-317
328
847
1,119

H1

H1

FY2021
H1
H2
241
333
-35
-313
-1
-23
206
20
1,342
1,392

FY2022
FY2023
H1
H2
H1
141
292
356
-262
-181
-100
-195
-121
-178
-121
111
256
1,214
1,321
1,408

(Ref) Prepared by Alpha-Win Research Dept. based on information including the financial results summary and briefing materials. H1 = first
half. H2 = second half.

w Equity ratio is about 60%,
indicating financial
soundness.
w Intangible fixed assets
including goodwill havebeen smaller than the net
assets.

w Estimated to have an
unrealized gain of a little
greater than Y1.3 billion
owing to its subsidiary’s
shares.

Its total assets are about Y3.2 billion and its market capitalization is about
Y4.0 billion (based on the closing price of Y623 on March 31, 2023), both
relatively small. However, its equity ratio is 59.3% and current ratio is greaterthan 200%, indicating financial soundness (both as of the end of March 2023).
Goodwill had increased due to the acquisition of companies and businesses,
but it is now decreasing due to amortization. Since the balance of goodwill asof the end of March 2023 was Y420 million, which is about 70% of the
expected EBITDA for the full fiscal year, a lump-sum amortization of the
goodwill is possible as well (Figure 3). Intangible fixed assets, which is a sumof the goodwill and Y420 million in software and software in progress, total
Y860 million. Adding deferred tax assets of Y70 million to this, the total
comes out to be Y930 million, which is smaller than the net assets of Y1.93
billion (48%) and therefore should not be a problem.
Also, the Company owns about 90% of the shares of its subsidiary EC-CUBE
Co., Ltd. Based on the amount for which a portion of the subsidiary’s shares
was sold to Orient Corporation (the amount as of when they were sold in
November 2020), the Company is estimated to have shares worth Y1.4 billion
in market value and an unrealized gain of Y1.37 billion.

【Figure 3】Change in the Balance of Goodwill and Amount of Amortization
Yearly Goodwill
Goodwill (balance on B/S: million yen) ①
Annual amortization of goodwill (on CF statement: million yen) ②
Average period of amortization (years) ③＝①/②
EBITDA ④
Goodwill/EBITDA ⑤=①／④

FY2014000273
0FY2015000373
0FY2016000286
0FY2017000174
0FY2018000
60

FY2019
109
16
7.0
247
0.4

FY2020
316
55
5.8
514
0.6

FY2021
450
84
5.4
638
0.7

FY2022
484
108
4.5
686
0.7

H1 FY2023
423
61
3.5
618
0.7

(Ref) Prepared by Alpha-Win Research Dept. based on information including the financial results summary and financial results briefing materials.
For H1 FY2023, numbers in italics are annual forecasts or have been calculated for the full year; EBITDA is the average of the Company’s forecast.

7/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

2．Business Contents and Business Modelw Worked on restructuring its
business portfolio.
Withdrew from non-corebusinesses andconcentrated businessresources on AD EBiS of
the Marketing PF segment.
In recent years, it has been
expanding its businessagain, including the EC PF,
through acquisitions ofbusinesses and companies
in related areas.

◆Business Portfolio
Restructuring and Strengthening the Business Portfolio
Since FY2016, the Company had been actively restructuring andstrengthening its business portfolio (Figure 4). It had been increasing its focus
on the core businesses (shifting to AD EBiS of the Marketing Platformsegment), separating its non-core businesses (EC Platform segment), andconducting M&As. This business restructuring has reached the end of a phase,though, and the Company is currently in the stage of expanding its businessfor the next level of growth.

【Figure 4】Business Restructuring and Segments(Businesses that it withdrew from are highlighted in gray and the new services are highlighted in yellow)
Segment Name

Main Services (or company name)① AD EBiS: advertising effectiveness measurement tool

Business Categories(1) Advertising effectiveness measurement➁ THREe: paid-listing ad management

Business acquisition (August 2018)➁ Ad-Knowledge: cloud-based project management tool

Started service in May 2020; changed name to AD HOOP in Jan 2021

② eZCX: e-commerce-specialized CX improvement PF

Official version released in July 2021

③ Spoo: web media/design & management services

Acquired as a wholly owned subsidiary (Dec 2020)④ TOPICA: SNS and video marketing support

Consolidated

Acquired as subsidiary with about a 60% stake (July 2021)⑤ Far End Technologies: project management tool

II. EC Platform

Parent company

Service ended on Jan 31, 2023 (started service in July 2020)① AD HOOP: marketing-specialized matching(3) Incubation(previously "new services")

Notes

Withdrew (end of March 2020)① AdRepo: automatic report generation tool for advertising analysis(2) Advertising agency DX
I. Marketing
Platform

Changes
ADPLAN business (acquired in Jan 2020; merged):closed in March 2021

Acquired as a wholly owned subsidiary (Jan 2022)*OtherFormer "Professional Service" (DMP business)(Former "SOLUTION"; transferred from SOLUTION and scaled down)

Parent company(1) EC-CUBE

EC-CUBE and ec-cube.co: open-sourced e-commerce website building

Transferred to EC-CUBE Co., Ltd., in Jan 2019; about 10% of shares soldto Orico

Consolidated(2) E-commerce website building & operation
support (new: professional services)① BOKUBLOCK: e-commerce webite building & operation supportand solutions

Acquired as a wholly owned subsidiary (end of May 2022)

Consolidated① E-commerce contract devopment, consulting, etc.

(3) SOLUTION → withdrew

Transferred to SAI Co., Ltd. (equity method; kept) and Radical Opti Co.,
Ltd. (removed from equity method after transfer)

Equity method

Transferred to Marketing Platform's *Other

Parent company(Of which is DMP business)(Ref) Figure 4-7 were prepared by Alpha-Win Research Dept. based on sources including the Company’s financial results summary and financial
results briefing materials. Words in red in Figure 4 indicate changes and events during the current fiscal year.

[Figure 5] Sales and Profit Breakdownby Segment (first half of FY2023)
EC Platform
17.8%

Business Composition
Currently, the Company’s business is composed of two segments: I.
Marketing PF (short for “platform”) and II. EC PF.

MarketingPlatform

82.2%

The Marketing PF segment accounted for about 80% of the total sales in thisfiscal year’s first half (Figure 5) and has long been the driver of theCompany’s overall sales growth (change in sales by PF segment: Figure 6).

25.7%

FY2023 First Half

Sales (outer circle)
Operating Profit (inner circle)

74.3%【Figure 6】Transition in Sales by Business
Segment (Unit: million yen)

【Figure 7】Transition in Operating Profit by Business Segment(Million yen)

(Million yen)

4,000

Marketing Platform

Marketing Platform

300

EC Platform

EC Platform

250
200

414

3,000

358

150

301

1,000

422
666

0

FY2013

539

477

526

883

911

1,074

FY2014FY2015FY2016

465

1,255

275

1,530

1,951

2,318

214

100

253

2,000

2,599

2,925

1…

323

50
0

1,420

1,493

142
75

107

210

38

FY2018FY2019FY2020

FY2021

FY2022H1
H1
H1
H1
FY2022 FY2023
FY2023
FY2022

78

119

108

158

143
34

54

(1)

(50)

(60)

(100)
FY2017

22

46 39

280

247

199

153

136

(121)

(150)
FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

H1
H1FY2022
FY2022(Ref) Prepared by Alpha-Win Research Dept. based on sources including the Company’s financial results summary and financial results briefing materials.

8/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

FY2023
H1H1FY2023

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023
2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18
w Excluding the period of
Each PF segment’s change in operating profit over the years is as shown inbusiness restructuring, bothFigure 7 on page 8. Excluding FY2017 and FY2018, during which business
PF segments have been
restructuring was conducted, operating profit (segment’s profit) has been
posting operating profits.

posted for both PF segments during each full fiscal year.

The Company’s current business portfolio is as shown in Figure 8 (thenumbers assigned to each business in Figure 8 match the numbers in Figure
4 and in the descriptions starting from this section’s description of business
contents).

【Figure 8】Business Composition (as of the end of May 2023)
Marketing DX Support Businesses
I. Marketing Platform Segment(1) Advertising(2) Advertising

EffectivenessAgency DX

Measurement①

II. EC Platform Segment(3) Incubation

website building

①

①

①

③

AdRepo:Advertising

Automatic reporteffectivenessgeneration tool for
programmatic ads②

No. 1 sales
share in Japanʼs
ad effectiveness①④
Decentralized video media

Cloud-based e-

Various solutions for e-

management service

commerce platform

commerce

No.1 open-source⑤

software for e-

E-commerce-specializedmeasurement
market1

supportcommerce

Advertising agency
matching platform& operation
Open platform for e-

Creative Agency

measurement platform(2) E-commerce(1) EC-CUBE

CX improvement

Developing and providing

platformproject management tools

commerce website
building in Japan by
number of users2(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials with some edits and additions.
*1: According to the Japan Marketing Research Organization’s summary of its June 2021 survey on competition in designated areas*2: According to Information-technology Promotion Agency, Japan’s “3rd Open-Source Software Utilization Business Survey”◆ Business Details I. Marketing PF Segment
The breakdown of sales and change in profit of the Marketing PF segment
over the years are shown in Figure 9.

【Figure 9】Change in Sales and Operating Profit of the Marketing Platform Segment
Sales (million yen)
I. Marketing Platform(1) Advertising Effectiveness Measurement(1) ➀AD EBiS + former ADPLAN (business acquired in Jan 2020)①AD EBiS's sales growth rate (YoY: %)② THREe (withdrew)(2) Advertising Agency DX(2) ①AdRepo➁Ad-Knwoledge(3) Incubation (previous "new services")(3) ①AD HOOP, ②EZCX, ③Spoo, ④TOPICA, ⑤Far End*Other: previously, Professional Service (DMP)
Segment's Operating Profit
Segment's Operating Margin (%)

FY2014FY2015FY2016
Consolidated Consolidated Consolidated
883
911
1,074
883
911
1,074
722
822
1,012
27.3%
13.9%
23.1%
161
89
62

FY2017
Consolidated
1,255
1,254
1,200
18.6%
54

FY2018FY2019FY2020
FY2021
FY2022H1 FY2023
Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated
1,530
1,951
2,318
2,599
2,925
1,492
1,445
1,775
2,135
2,313
2,369
1,134
1,402
1,747
2,127
2,313
2,369
1,134
16.8%
24.6%
21.8%
8.8%
2.4%
-3.6%
43
28
8
0
0
0
124
152
182
175
90
(Business acquired in Oct 2018 →)
124
149
3
3
89
380
269

(Spoo acquired in Dec 2020; TOPICA acquired in July 2021; AD HOOP transferred from advertising agency DX
starting in FY2021; Far End acquired in Jan 2022 →)(Professional Service, transferred from EC PF →)

142
16.1%

214
23.5%

210
19.5%

153
12.2%

84
-121
-7.9%

51
46
2.4%

3

89

380

269

27
199
8.6%

247
9.5%

280
9.6%

158
10.6%

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials and interview.
(Note) Includes Alpha-Win’s estimates. Sales are those toward external customers.

w The Marketing PF segment
is composed of threebusiness categories.

I. The Marketing PF segment currently consists of the three main businesscategories (1) through (3) described in Figure 8. During this fiscal year’s first
half, the breakdown of sales of this segment was as shown in Figure 9 and
Figure 10 on page 10. While the sales proportion of AD EBiS has decreased
compared to before, it still accounted for 76% of the Marketing PF segment’s
sales (63% of the Company’s entire sales).
9/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18【Figure 10】Breakdown of the Sales ofthe Marketing PF by Business Category(2) Ad Agency DX

6％18％(3) Incubation(1) Ad EffectivenessMeasurement

Marketing
76％
PF
Sales
Breakdown(H1 FY2023)(Ref) Prepared by Alpha-Win Research Dept. based on thefinancial results briefing materials.

w Its core business, AD EBiS,
is an originally developed,
Internet ad effectivenessmeasurement system. It has
the top share in the market
and accounts for about 60%of the Company’s entire
sales. Highly stablebusiness based onsubscriptions.

w (5) Subscription model: fees arew paid periodically for the rightto use the service for a certain
period.

(6) Programmatic advertising:An advertising method inwhich optimization of ads is
conducted automatically or
supported immediately. After
submitting an ad, optimizationis conducted, leading to better
results.
w The business for advertising
agencies consists of only
AdRepo, which fully
automates the creation ofreports for programmatic
advertising. It withdrew
from Ad-Knowledge, acloud-based project
management system
specialized for advertising
agencies.

Below are the current business categories of this PF and their main products(service or product name is in bold and underlined).

(1) Advertising Effectiveness Measurement① AD EBiS・Internet advertising effectiveness measurement system
・The Company’s originally-developed, core product (incredibly strong
position in the Japanese market with the top share of 86.7 %, according
to the Japan Marketing Research Organization’s summary of its survey
on competition in designated areas for the period ended June 2021).
・ Enables the collective management, measurement, analysis, andvisualization of the effectiveness of Web ads, etc., and helps understandthe cost effectiveness of ads.
・Subscription-based business model5
・Business based on flat-rate, periodic payments. Its sales are determinedby average unit price times the number of active accounts. Both numbers
are key indicators that impact not only the performance of the AD EBiS
business but also of the entire company. Sales in the first half of this fiscal
year are estimated to have been Y1.13 billion (about -3% from Y1.18
billion in the first half of the previous fiscal year) (Figure 9 on page 9).

(2) Advertising Agency DX
This business targeting advertising agencies consists of only the AdRepobusiness (AD HOOP has been moved to the incubation category and theCompany has withdrawn from the Ad-Knowledge business). Sales in thisfiscal year’s first half are estimated to have been Y90 million, which was 6%of the Marketing PF’s entire sales (same proportion as the previous fiscal
year’s second half).
① AdRepo
・Fully automatic report-generation tool for programmatic advertising6
・ Cloud service that has been developed to reduce the workload of
advertising agencies
・The business was acquired from another company in August 2018. The
Company plans to continue to focus on expanding this business.
② Ad-Knowledge
・An original, cloud-based project management system specialized foradvertising agencies
・Aimed to support advertising agencies that work with programmatic
advertising in improving their operation and efficiency
・Service was started in July 2020, provided as a subscription service(SaaS). However, the Company withdrew from this business in January2023.

w The Incubation businessconsists of the businesses of
the 3 consolidated
subsidiaries acquired
through M&As and theCompany’s originallydeveloped products AD
HOOP and eZCX. Thesebusinesses are expected to
become the Company’s
future growth drivers.

(3) Incubation (Figure 11 on page 12)① AD HOOP
・Marketing-specialized matching platform that introduces the optimum
solution partner to corporate advertisers to solve their problems and meettheir needs. Released in May 2020, and then moved from the advertising
agency DX category. Since March 2023, service domains have been
expanded significantly from three to twelve. Steadily expanding thebusiness through the acquisition of new projects and cross-selling.
10/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

・Sales in the first half of this fiscal year were Y25 million (+71% YoY;
2% of the Marketing PF’s sales). As with eZCX, the challenge is to turnthe business profitable.
② eZCX・E-commerce-specialized CX improvement platform
・Helps improve CX (customer experience) on websites. Leads to greater
efficiency in acquiring new customers.
・It has been released in May 2021, but the Company is currently limiting
its sales due to the reconsideration of service (sales in the first half were
just Y2 million).
w Has been acquiring
companies in businesses
related to Internet
marketing as
consolidated
subsidiaries at a pace ofabout 1-2 companies per
year.
w All three acquiredcompanies have beensteadily expanding theirbusinesses.

As described below, the Company has been acquiring companies that are
in businesses related to Internet marketing at a pace of one or two
companies per year, making them consolidated subsidiaries. All threerecently acquired companies are steadily expanding their businesses byleveraging their edge and synergies.
③ Spoo (Spoo! inc.): consolidated subsidiary (wholly acquired)・Web media and design company. Founded in March 2000 and was
acquired by the Company in December 2020. Contract-development
service provided by a small team. Recruitment has been a challenge.
・Leveraging Spoo’s creativity and talents to integrate with the Company’s
data and technology. Plans to thereby create new values, expand into
more areas of business, and strengthen its competitive edge.
・Sales increased by 47% from Y24 million in the first half of theprevious fiscal year to Y36 million in the first half of this fiscal year.
④ TOPICA: consolidated subsidiary (60% stake)・Founded in May 2016. Acquired in July 2021.
・Developing a marketing support business that utilizes SNS and videos(ranging from the planning and production of video contents to SNS
account management services)
・With the acquisition, the Company plans to expand its business domain
into the rapidly growing social media marketing market and cross-sell
TOPICA’s services to its current client companies (around 1,300
companies). In addition to this, it plans to integrate its data andtechnologies with TOPICA’s SNS marketing business to create andprovide new services.
・Sales increased by 44% from Y88 million in the first half of theprevious fiscal year to Y127 million in the first half of this fiscal year.
Steadily expanding business.
⑤ Far End Technologies Corporation (hereinafter, “Far End”):
consolidated subsidiary (wholly acquired)・Established in September 2008. Provides Internet services (SaaS) and IT
security support services.
・Acquired in January 2022 as a wholly owned subsidiary
・Its main business involves the development of the globally well-known,
open-source project management software Redmine and the paid, cloudversion of the software, My Redmine.
・In recent years, due to increased remote work in response to the COVID19 crisis, there has been greater demand for project progress management.
11/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

The number of accounts has been increasing steadily and significant
growth can be expected.
・By leveraging and integrating with the YRLGM Group’s technologies
and expertise, the Company plans to expand its business domains,
increase its competitive edge, and provide new value to customers.
・Sales increased by 226% from Y23 million in the first half of the previous
fiscal year (sales for the two months after the acquisition) to Y75 million
in the first half of this fiscal year (for the entire period).

【Figure 11】Comparison of the Incubation Businesses’ Sales in the First Half
Sales of Originally Developed Services(Since May 2020)(Since July 2021)

Sales of Subsidiaries Gained through M&As

(Since December 2021)(Since July 2021)(Since February 2022)

127

Last H1: the first half of FY2022
This H1: the first half of FY2023
Units: million yen

88
YoY+47.3%

YoY+71.0%

YoY

YoY+44.0%

3.3x
75

25

15

Last H1

This H1

Limiting sales due toreconsideration of service
1

2

Last H1

This H1

24

Last H1

36

This H1

23*

Last H1

This H1

Last H1

This H1*Last H1: total of sales for the two months after acquisition(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials with partial edits/additions

w The EC PF segment iscomposed of EC-CUBE andthe professional services.
(7) Professional services: A
general term for services otherthan the cloud; includes
consulting, accountmanagement, and contractdevelopment.

◆ Business Details: II. EC PF Segment
Previously, the EC PF segment had only consisted of EC-CUBE. However,with the acquisition of BOKUBLOCK INC., the Company has reentered theprofessional services7 market (e-commerce website building & operation
support) (consolidated starting in June 2022). Thanks to large synergies with
EC-CUBE, this subsidiary is contributing well to the segment’s performance(Figure 9).

【Figure 12】Change in Sales and Operating Profit of the EC Platform Segment
Sales
FY2014FY2015FY2016FY2017FY2018FY2019FY2020
FY2021
FY2022H1 FY2023(million yen)
Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated Consolidated
II. EC Platform
477
526
539
465
275
253
301
358
414
320
(1) EC-CUBE
245
230
219
208
254
253
301
358
331
176
EC-CUBE's sales growth rate (YoY: %)
18.3%
-6.1%
-4.8%
-5.2%
22.2%
-0.4%
19.0%
18.9%
-7.4%
9.3%
①Shopping settlement fee
290
253
134
②Subscription
1229
19③Other54
50
22
New: (2) E-commerce website building &083
144
operation support (BOKUBLOCK)Previous: (3) SOLUTION (transferred/withdrew)
232
296
319
257
20
0
0
0
0
0
Previous: ① E-commerce contract development, e232
296
319
257
20
0
0
0
0
0
commerce website consulting, etc.
Of which is DMP (transferred)
104
Segment's operating profit
107
136
38
-60
22
39
78
119
108
54
Segment's operating margin
22.5%
25.8%
7.1%
-12.9%
8.2%
15.4%
26.1%
33.1%
26.1%
17.0%

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials and interview.
(Note) Includes estimates. Sales are those toward external customers.

w The EC-CUBE businessprovides software forcompanies to build andmanage e-commerce
websites on their own.

① EC-CUBE
Service Overview
・EC-CUBE is a software platform whereby companies can build and manage
e-commerce (EC) websites on their own.
12/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

・The Company provides EC-CUBE as web design software for companies
that will begin selling and providing products or services online. It isprovided as either as the open-source, packaged download version ECCUBE or the cloud version ec-cube.co.
・Characterized by low cost, high customizability, and high usability, it has
the top share in the Japanese market and is the standard platform.

w In addition to thedownload version, thecloud version has beenreleased.
w Gained top share in theJapanese market.

Business Model and Sales Breakdown
・EC-CUBE is based on a freemium model8 in which software is offered for
free, but in return, revenue is earned from the peripheral services.
・Revenue comes from shopping settlement fees from official partners using
the software for their Internet businesses (42% of the total sales of this PF
in this first half), ec-cube.co’s monthly subscription income (similarly, 6%of the total), and other revenue (function addition fees for plugins, or
programs to add functions to software; similarly, 7% of the total) (Figure13).

(8) Freemium model:“Freemium” is a coined wordthat combines “free” and“premium.” Refers to abusiness model that generates
revenue by offering basic
services free of charge whilecharging fees for moresophisticated or speciallyadded, related services.

Each Business’ Trends in Financial Performance: II. EC PF
Segment (2) E-commerce Website Building & Operation Support

w Planning to expand theprofessional services

Through an M&A, BOKUBLOCK’s e-commerce website building & support
business has become included in this segment’s results starting in theprevious fiscal year (Q3 FY2022). As a result, the Company has now fully
entered the professional services business and has been working on building
a one-stop service under a hybrid model linked with EC-CUBE. Changes inthe sales of the e-commerce website building & operation support businesstend to depend on the orders received for website building projects and theirprogress. Since the acquisition, though, sales have grown significantly thanks
to synergies within the Group, having successfully gained large projects(sales during this fiscal year’s first half were Y144 million, accounting for
45% of the entire sales of the segment, whereas sales were zero in theprevious fiscal year’s first half since it was before the consolidation).

w The e-commerce website
building & operation
support business grewsignificantly thanks tosynergies within theGroup.

【Figure 13】Breakdown of Sales of the EC PF Segment (Units: % or million yen)
Other

Shopping
settlement fee

Other

14%

Subscription

8%

Subscription

EC PF
Sales
Breakdown

Other

Other
Subscription

12％
7％

EC PF
Sales
Breakdown

EC PF
61％
Sales
20％ Breakdown78%(FIrst half of
FY2022)

Shopping
settlement fee

7%

6%

45％

(FY2022)

E-commerce website
building & operation
support

Shopping
settlement fee

Subscription

EC PF
Sales
Breakdown

42%(Company forecast
for FY2023)(First Half of
FY2023)

E-commerce website
building & operation
supportE-commerce
website building &operation support

More than

45％【Figure 14】Quarterly Change in the Sales of the EC PF Segment (Unit: million yen)
(Million yen)

EC-CUBE

Other

E-commerce website building & operation support

183(Ref) Figures 13 and 14: prepared by
Alpha-Win Research Dept. based on
the financial results briefing materials
with partial edits/additions.

81

Q1

Q2

Q3

FY2016

Q4

Q1

Q2

Q3

FY2017

Q4

Q1

Q2

Q3

FY2018

Q4

Q1

Q2

Q3

FY2019

Q4

Q1

Q2

Q3

Q4

Q1

FY2020Q2

Q3

FY2021

Q4

Q1

Q2

Q3

FY2022Q4Q1 Q2FY2023

Note: "Other" includes services which the Company has already withdrawn from, such as the e-commerce contract development business.

13/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

3．Shareholder Composition
w No significant change tothe major shareholders.
Parties affiliated with theCompany (former andpresent executive officers
plus the employee stock
ownership plan) possess
about 60% of all shares intotal.

◆ Major Shareholder Composition
The major shareholders as of the end of March 2023 are shown in Figure 15.
The following is supplementary information. Other than the individual
shareholders and securities companies, the major shareholders have mostly
not changed.
・The top three shareholders are Susumu Iwata, the Company’s president,
followed by the Company’s executive officers (including former executive
officers). Together, they possess more than half of the outstanding shares.
・The banks and securities companies are most likely investing as custodiansof the below investment trusts or in relation to their customers’ positions.

w Invested by several
Japanese stock investment
trusts.

・Regarding Japanese investment trusts, “The 2020 Vision” managed by
Commons Asset Management owned 108 thousand shares as of December
19, 2022 (0.57% of the fund’s portfolio; 161 thousand shares were owned asof Dec. 20, 2021). The Company’s shares are also included as a small portionin “Rakuten Japan New Economy Index Fund (JANE Index)” (0.04% of thefund’s portfolio).

w Treasury shares are 1.39%

・In the past, the Company had used a portion of the treasury shares astransfer-limited, stock-based compensation. As of the end of March 2023, it
owned 88,680 treasury shares (1.39% of all outstanding shares; essentiallythe sixth largest shareholder).
・ The Company may use the treasury shares in the future for stock
cancellation, M&A and alliance strategies, or stock-based compensation for
its executives and employees.

of all outstanding shares,
essentially ranking itself
as the sixth largest
shareholder.

【Figure 15】Current Major Shareholders

Susumu Iwata (president and CEO)Hiroichi Fukuda (former executive vice president)
Kanako Mataza (former director and senior executive officer)
Rakuten Securities, Inc.
Custody Bank of Japan (trust account)
SBI SECURITIES Co., Ltd.
Japan Securities Finance Co., LTDYRGLM Employee Stock Ownership Plan
Hakuhodo DY Media Partners Inc.
Tomonori Yamada (indiv.)
Yoshihisa Yamashita (indiv.)
Satoshi Hasegawa (indiv.)
J.P. MORGAN SECURITIES PLC
Custody Bank of Japan (securities investment trust account)
Yukio Tanaka (individual investor)
UEDA YAGI TANSHI Co., Ltd.
au Kabucom Securities
Mitsubishi UFJ Morgan Stanley Securities
Japan Trustee Services Bank (former name)
BNY GCM CLIENT ACCOUNT JPRD AC ISG (FE-AC)
Trust & Custody Services Bank (former name)
GOLDMAN SACHS INTERNATIONALUEDA YAGI TANSHI Co., Ltd.
Katsuyuki Ito (indiv.)
Akiko Takashima (indiv.)
Kenichiro Wade (former outside director)
Yoshio Takayama (indiv.)
Kayoko Nagano (indiv.)
SEPTENI CO., LTD
Matsui Securities Co., Ltd.
Yoichi Nishikawa (indiv.)
Akio Shiojiri (former director: audit committee member)(Treasury shares: thousand shares)(Percentage of treasury shares: %)(Unit for number of shares: thousand shares) (Unit for ratios: %)End of Sept.
2015

End of Sept.
2016

End of Sept.
2017

2,851
1,071
415
―
―
―
30
76
60
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
39
―
―
62
―
34
26
0

2,817
1,021
415
―
―
―
35
39
60
―
―
―
―
―
―
―
―
―
59
―
―
―
―
―
―
29
―
―
62
36
―
―
0

2,817
1,021
352
―
―
―
―
48
60
28
―
―
―
―
―
―
―
―
―
60
60
―
―
―
―
29
28
24
―
―
―
―
0.045
0.00%

End of Sept.
2018

2,819
961
354
72
―
―
―
69
60
―
―
―
―
―
―
―
―
―
60
―
29
―
―
52
29
―
―
―
―
―
―
―
0.983
0.02%

End of Sept.
2019

2,822
801
353
64
―
―
―
68
60
―
―
―
―
―
―
―
―
―
333
―
123
284
113
―
―
―
―
―
―
―
―
―
81.423
1.28%

End of Sept.
2020

2,825
781
352
―
221
―
―
71
60
―
―
―
―
169
―
86
62
58
―
―
―
―
―
―
―
―
―
―
―
―
―
―
64.493
1.01%

End of Sept.
2021

2,827
817
329
―
128
―
―
66
60
33
54
―
35
82
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
57.8250.91%

End of Sept.
2022

2,809
779
329
―
103
―
―
69
60
36
54
37
34
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
―
111.580
1.75%

End of Mar.
2023

2,788
661
329
177
97
85
80
73
60
53

←Shareholding
Ratio

44.36
10.52
5.23
2.81
1.54
1.35
1.26
1.16
0.95
0.84

←Ranking

1
2
3
4
5
6
7
8
9
10

88.680
1.39%(Ref) Prepared by Alpha-Win Research Dept. based on materials including the securities report. Names in red indicate YRGLM’s former
and current members, employee stock ownership plan, and other groups or individuals affiliated with the Company.

14/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

4．History of Growth◆ Past Transition in Financial Results
Sales
w Posting record-high sales for
13 fiscal years in a row

w Conducted M&As anddeveloped and released
unique products thatdifferentiate the Company
from other companies. Hasgrown rapidly by predicting
and meeting the needs ofsociety ahead of others.

From FY2009 to FY2022, sales have been hitting record highs every year, atleast for the 13 fiscal years for which information is disclosed. During thisperiod, sales have increased by about 5.8x from Y570 million to Y3,330
million (annual compound rate of +14.5%).
The Company has grown rapidly by developing and releasing uniqueproducts that can be differentiated from other companies, predicting andmeeting the needs of society ahead of others, as well as by conducting M&As
and increasing its employees. Its growth has been achieved thanks to therelease and expansion of cloud services, especially the rapid growth of its
originally developed service AD EBiS of the Marketing PF, and the steady
growth of the EC PF’s EC-CUBE as the e-commerce market grew.

Profitw In FY2015, record-high profits
of the time were recorded.

w Starting in FY2016, theCompany had conductedbusiness restructuring andupfront investments,
prioritizing acceleration of
future business growth overprofit. Net losses wererecorded consecutively in
FY2018 and FY2019.
w Since then, sales haveincreased and costs have
improved, leading to a Vshaped recovery in businessperformance. In FY2021, sales
and profits hit record highs,
and in FY2022, operating andrecurring profit hit record
highs in consecutive years.

Regarding profit, the Company had stayed profitable both on a standalone
and consolidated basis up through FY2017. In FY2015, a record-highoperating profit of Y350 million and a record-high net profit of Y231 million
were achieved. However, starting in FY2016, the Company’s active businessrestructuring and upfront investments had increased the expenses, leading toa consecutive decline in profit despite increasing sales. In FY2018, theCompany recorded a loss (operating loss of Y98 million and net loss of Y88
million) for the first time since becoming listed on the market, due to upfront
investments mainly to hire more employees for development and sales(Figures 16 and 17). In FY2019, the Marketing PF’s sales grew by 20%
thanks to its main product AD EBiS, and the Company was able to post bothan operating profit and a recurring profit for the full year in a turnaround.
However, due to extraordinary losses, it posted a net loss for the second
consecutive fiscal year.
In the following year or FY2020, consecutive growth of sales andimprovements in cost resulted in a 3x growth in operating and recurring profit
compared to the previous fiscal year. The Company posted a net profit for the
first time in three fiscal years in a clear, V-shaped recovery. In FY2021, theCompany posted record profits for the first time in six years, and in FY2022,
operating and recurring profits both hit record highs for consecutive years.

【Figure 16】Transition in Past Financial Results andthe Company’s Forecast for This Fiscal Year

【Figure 17】Change in the Number of Employees(Unit: persons)(Units: million yen, %)250

Sales (left axis: million yen)
Operating margin (right axis: %)

4,000

30.0%

3,500

Other

200

25.0%

3,000

20.0%

2,500

141

150

10.0%
5.0%

1,000

50

0.0%

500
0

-5.0%

(500)

-10.0%

FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

98

100

1,500

0

149

122

15.0%

2,000

221

Development

Operating profit (left axis: million yen)

68

71

33

33

35

38

42
56

58

64

67

83

74

66

167

221

184
141

102

65

120

64

80

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022

FY2023 CE

H1
FY2023(Ref) Figures 16 and 17 were prepared by Alpha-Win Research Dept. based on the securities reports, financial results summary, and financial results
briefing materials.
(Note) Consolidated results starting in FY2014; nonconsolidated prior to this. CE = the Company’s estimate/forecast.

15/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

5．Market Environment◆ Trends of Japan’s Advertising Market
Total Advertising Expenditure
Total advertising expenditure in Japan in 2022 (calendar year; the same
applies to this entire section) hit a record high at about Y7.1 trillion, having
increased by +4.4% from the previous year. Despite the negative impact of
the rebound of the COVID-19 outbreak, the situation in Ukraine, andinflation, the overall market remained firm thanks to the growth of Internet
advertising expenditure along with the digitalization of the society.

w In 2022, Japan’s total

advertising expenditure
was solid and grew by 4%
YoY.

Internet Ad Market (Annual)With the digitalization of the society, the e-commerce market boom, andgreater demand for video ads, the Internet advertising market (sum of medium
cost and production cost) grew by +14.3% YoY to about Y3.1 trillion,
maintaining a double-digit growth. Since 2005 (point of comparison, set at100) to 2022, the market has grown rapidly by 8.2x (annual growth rate ofabout +13.4%, on a simple average; compound growth rate of +17.6%)(Figure 18). Internet advertising expenditure accounts for about 43.5% of thetotal advertising expenditure (39.8% in the previous year) as the largest
medium. Its proportion has been steadily increasing by several percent every
year (source: Dentsu Inc.’s “2022 Advertising Expenditures in Japan”).

w Internet advertisingexpenditure has been
continuing to grow at ahigh, double-digit rate. It
has become the largest
medium for advertising.

【Figure 18】Change in Advertising Expenditure by 【Figure 19】Change in Monthly Sales of Internet Ads
Medium (Indexation: the year 2005 is set to 100)
900%

(100 million yen)

(%)

1,600

50.0

850%

Internet sales (left axis)
YoY growth (right axis)
YoY decline (right axis)

1,400

800%
750%

Internet ads

700%

40.0

1,200

The four mass media

650%

Promotional media

550%

30.0

1,000

Total advertising expenditure

600%

800

500%
450%

20.0

600

10.0

400%
350%

400

300%

0.0

200

250%

0

150%
100%

Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.
May.
Jul.
Sep.
Nov.
Jan.
Mar.

200%

2013

50%

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

0%
2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

(Ref) Figure 18: prepared by Alpha-Win Research Dept. based on Dentsu Inc.’s “2022 Advertising Expenditures in Japan”
Figure 19: prepared by Alpha-Win Research Dept. based on the “Survey of Selected Service Industries” by the Ministry of Economy, Trade, and Industry(reflects monthly data through March 2023).

w The internet advertisingmarket had been solid after
turning to a positive(monthly) trend, but its
momentum is declining.

Internet Ad Market (Monthly)
The COVID-19 crisis had caused the entire Internet advertising market toshrink on a year-on-year comparison (based on the sales of the advertisingindustry as announced by the Ministry of Economy, Trade, and Industry)
since the beginning of 2020, but the market came back to growth in Octoberof the same year. The market had then maintained its growth for a while, but
fell to a -2.8% decline in March of this year (Figure 19). The internet admarket is still solid, but the stay-at-home consumption has somewhat settled
down and the momentum (sales growth rate) has been declining on a monthly
basis. Regarding the Company’s Internet ad business, the businessenvironment is predicted to remain advantageous for the Company due to thefurther digitalization of the society.
16/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

(10.0)

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

6. This Fiscal Year’s First-Half Results andFull-Year Forecast◆ Results for Q2 FY2023 (first half)
Overview
The consolidated financial results for the first half of FY2023 (first half or“H1”: October 2022 to March 2023) were as follows: sales increased by+14.6% YoY (+Y231 million) to Y1,812 million and operating profit
increased by +19.2% YoY (+Y34 million) to Y210 million. Both sales andprofit increased at double-digit rates (Figure 20). Both the Marketing PF andthe EC PF experienced sales and profit growth. Especially the EC PF grew,with sales doubling and contributing to the overall results.

w Double-digit sales andprofit growth in the first
half, also hitting record
highs for both.

There were no major nonoperating profit/loss or extraordinary gain/loss
posted. Consequently, the net profit resulted in an increase of 25.5% YoY(+Y27 million) to Y131 million. For first-half results, these were record-highsales and profits.

【Figure 20】Comparison of Quarterly and First-Half Results
FY2022(Units: million yen, %)Total Sales
Marketing Platform
EC Platform
Gross Profit
Gross Margin
SG&A Expenses
SG&A Expenses Ratio
Operating Profit (by segment)
Marketing Platform
EC Platform
Operating Margin
Marketing Platform
EC Platform
Recurring Profit
Net profit

FY2023

Q1 (Oct-Dec) Q2 (Jan-Mar) Q1 (Oct-Dec) Q2 (Jan-Mar)
777
804
879
933
697
723
742
750
80
81
140
180
505
564
554
576
65.0%
70.1%
63.1%
61.7%
417
475
457
463
53.7%
59.1%
52.0%
49.6%
88
89
97
113
70
73
71
86
18
16
27
28
11.3%
11.0%
11.1%
12.1%
10.1%
10.0%
9.6%
11.5%
22.1%
19.7%
19.3%
15.3%
87
89
102
111
58
46
69
62

FY2022

FY2023

H1 (Oct-Mar)
1,581
1,420
161
1,069
67.6%
892
56.4%
176
143
34
11.2%
10.1%
20.9%
176
105

H1 (Oct-Mar)
1,812
1,492
320
1,130
62.4%
920
50.8%
210
158
54
11.6%
10.6%
17.0%
213
131

H1 FY2023 (YoY)
Amount of Change
231
72
159
62
28
34
15
21

36
27

% Change / Diff.
14.6%
5.0%
98.3%
5.8%
-5.2%
3.1%
-5.7%
19.2%
10.3%
61.8%
0.4%
0.5%
-3.8%
20.7%
25.5%

(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary and financial results briefing materials. Sales of each PF
segment are sales toward external customers.

w There was significant
progress with profit in thefirst half in terms ofachieving the revised fullyear plan.

w In the Marketing PF
segment, sales increasedslightly and the profit
margin was improved,
resulting in double-digit
profit growth.

Progress in the First Half
The percentage of progress during this first half in terms of achieving the fullyear forecast was as follows, in the order of before the revision of the fullyear forecasts ⇒ after the revision: sales were 46.5% ⇒ 49.0% to 50.3%(47.4% in the first half of the previous fiscal year), operating profit was 52.5%⇒ 63.6% to 75.0% (similarly, previously 44.9%), net profit was 54.6% ⇒65.5% to 77.1% (similarly, previously 44.1%), and EBITDA was 53.1% ⇒56.1% to 60.9% (similarly, previously 46.7%). Compared to the same periodof the previous fiscal year, there was significant progress in achieving therevised profits. Regarding the Company’s initial first-half forecasts, while
they have not been disclosed, both sales and operating profit seem to havebeen below expectations.
Trends in Financial Performance by Segment: I. Marketing PF Segment
By segment, sales of the Marketing PF segment (to external customers; thesame applies hereinafter) increased by Y72 million (+5.0% YoY) from
Y1,420 million in the first half of the previous fiscal year to Y1,492 million
in the first half of this fiscal year. Similarly, this segment’s (operating) profit
increased by Y15 million (+10.3% YoY) from Y143 million to Y158 million.
17/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023
2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18
w AD EBiS’s sales decreased.
Significant growth of the incubation businesses compensated for the sales
This was offset by the large
decline of AD EBiS, resulting in a slight sales growth for this PF overall.
increase in incubation’s
Regarding profit, although there was an increase in costs due to the M&As
sales.
and the depreciation of the yen, a double-digit profit growth was achieved
w The amount of loss
thanks to increased sales and reduction of costs associated with the officeimproved for the incubation
business.
relocation. Although a loss was posted for the incubation businesses, theimprovement in the amount of loss had significantly contributed to the results.
Trends in Financial Performance by Segment: Marketing PF Segment (1) AD
EBiSSales and profit growth of the Marketing PF used to be brought by the rise in
the average unit price of AD EBiS, the core business (Figures 6 and 7 on page
8 and Figure 24 on page 19). However, while the rate of increase in the
average unit price has slowed down, the decline in the number of accounts
has not stopped. These seem to have caused the sales of AD EBiS in the firsthalf to decline YoY (Alpha-Win Research Department estimates this decline
to have been about -3%).

w The unit price of AD EBiS
rose YoY, but its number ofaccounts have continued to
decline.

The average unit price was Y164,745 at the end of Q4 FY2022 (+Y12,609 or+8.3% YoY) ⇒ Y163,200 at the end of Q1 FY2023 (+Y10,964 or +7.2%
YoY) ⇒ Y167,976 at the end of Q2 FY2023 (+Y10,655 or +6.8% YoY)
(Figure 21).
On the other hand, the number of active accounts has continued to decline, inthe same order, from 1,183 ⇒ 1,162 ⇒ 1,121 (-123 or -9.9% YoY as of theend of this Q2) (net QoQ decline for 13 quarters in a row; Figure 22). In
addition, the churn rate has remained flat at around 2.4% since Q2 FY2022(Figure 23 on page 19).

w The churn rate remainedflat.

The main reason for the decline in the number of accounts in the first half of
this fiscal year was that the acquisition of new customers was below
expectations, while there was a certain number of cancellations as usual. The
Company analyzes that this may have been caused by changes in the media
environment, such as the increasing market domination by the major media
due to third-party cookie regulations9 (e.g., the migration to GA4, the Google
Analytics 4 property for access analysis) and the simple management
interface provided by each media for ad effectiveness measurement and ad
management.

w Struggling to acquire newcustomers.
(9) Third-party cookie
Regulations: Regarding privacy
protection regulations, see page
23 of Alpha-Win’s Company
Research Report published in
December 2022.

【Figure 21】Change in the Average Unit Priceof AD EBiS(Y)

157,321160,000

167,97
6

164,745
163,200

159,803
140,000

Change inprice system

Q4→Q1
Seasonal
variability

FY2018FY2019

1,543

1,516
1,433

1,438

1,464
1,451

1,425

1,244
1,121

1,413
1,363
1,311
1,290
1,281

1,000

1,216
1,183
1,162

900
800

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2FY2017

1,569
1,518

1,100

40,000FY2016acquired

1,500

1,513

86,621
84,91879,525FY2015

1,600

1,200

107,143
102,262
98,04260,000ADPLAN

Change inprice system(# of accounts)

1,300

126,825
124,032
120,070
111,587

100,000

of AD EBiS

1,400

152,136
146,310141,086
135,930

120,000

80,000152,236

ADPLAN acquired【Figure 22】Change in the Number of Accounts

FY2020

FY2021

FY2022

FY2023700
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023(Ref) Figures 21 and 22 were prepared by Alpha-Win Research Dept. based on the financial results summary and financial results briefing materials.

18/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18【Figure 23】Change in the Churn Rate of【Figure 24】Change in Sales of the Marketing PF by Business

AD EBiS(quarterly)

3.5%
3.0%

2.8% 2.7% 2.9% 2.7%

2.5%

Definitions
2.5% 2.4%

2.3% 2.3% 2.4% 2.4% 2.4%

2.0%

Lower 2% range

1.5%(Goal for end of
fiscal year)

1.0%
0.5%
0.0%

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4FY2020

FY2021

FY2022

FY2023w In the incubation
businesses, thesubsidiaries acquired
through M&As and theoriginally developed
service contributed toincreased sales andimproved profitability.
(10) PMI (Post-Merger
Integration): The process ofbusiness integration after
acquisition

w In the EC PF, the ecommerce website
building & operation
support business was
solid.

Incubation+3.9%

New Service Categories

Advertising Agency DX

750

722

Ad Effectiveness Measurement
Other*

・Since there is seasonalvariability in cancellations
due to when fiscal years
end for customers, etc.,
the 12-months moving
average was used tounderstand trends.

(Ref) Figures 23 and 24 were prepared by Alpha-Win Research Dept. basedon the financial results summary and financial results briefing materials. 1Q,
2Q, 3Q, and 4Q in Figure 24 are the same as Q1, Q2, Q3, and Q4.

w The advertising agency
DX business was solid.

YoY(Million yen)・Monthly churn rate =churn amount during themonth ÷ previous
month's sales

1Q

2Q 3Q
FY2016

4Q

1Q

2Q 3Q
FY2017

4Q

1Q

2Q 3Q
FY2018

4Q

1Q

2Q 3Q
FY2019

4Q

1Q

2Q 3Q
FY2020

4Q

1Q

2Q 3Q
FY2021

4Q

1Q

2Q 3Q
FY2022

4Q*Includes THREe, the business from which Company withdrew as of the end of March 2020, and the previous Professional Services (DMP business)

Trends in Financial Performance by Segment: Marketing PF Segment (2)Advertising Agency DX
Regarding AdRepo, which accounted for the entire sales of the advertising
agency DX category, its sales were 6% of the Marketing PF’s sales in the firsthalf (same proportion as the previous fiscal year’s first half). Its sales are
estimated to have been Y90 million and seem to have increased slightly by
5% compared to the previous fiscal year. Regarding Ad-Knowledge, theCompany withdrew from the business in January 2023.
Trends in Financial Performance by Segment: Marketing PF Segment (3)Incubation
Steady progress has made with the originally developed service AD HOOP
and with the PMI10 of the three consolidated subsidiaries that the Company
has acquired through M&As (Spoo, TOPICA, and Far End Technologies).
Their sales expansion (including full contribution in terms of the length ofperiod after becoming consolidated) contributed to the PF segment’s sales
growth (Figure 11 on page 12).
Sales of the incubation businesses increased by 75% from Y153 million in
the first half of the previous fiscal year to Y267 million in the first half of thisfiscal year. As a result, its proportion of the Company’s overall sales
increased from 12%⇒ 15%. Along with this increase in sales, it is estimatedthat the operating loss has also shrunk to about one-third (from about -Y80
million in the first half of the previous fiscal year to about -Y30 million; bothare estimates by Alpha-Win) (Figure 26 on page 20).
Trends in Financial Performance by Segment: II. EF PF Segment
Regarding the other segment or the EC PF segment, it accounted for 18% of
the Company’s overall sales and 26% of the overall profit. Within this PF
segment, EC-CUBE’s sales from shopping settlement fees accounted for 42%(Y134 million), while the e-commerce website building & operation supportof the acquired company BOKUBLOCK accounted for 45% (Y144 million)(Figure 13 on page 13).
Also, in the e-commerce website building & operation support business,orders for large-scale, one-time projects were received and contributed to theincrease in sales (sales were zero in the first half of the previous fiscal year
since it was before the acquisition). In terms of profit/loss, a small profit wasposted (Figure 26 on page 20). Performance has been solid and this businessis expected to account for more than 45% of the EC PF’s sales for this full
fiscal year (the proportion was 20% in the previous full fiscal year).
19/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

1Q

2Q 3Q
FY20234Q

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

Regarding EC-CUBE, due to raised shopping settlement fees and thesuccessful enhancement of matching through its collaboration with AD
HOOP, its sales increased by 9% YoY from Y161 million in the first half ofthe previous fiscal year to Y176 million in the first half of this fiscal year.
w Aiming to grow the ecommerce website
building & operation
support business byleveraging synergies
within the Group.

・By acquiring an Amazon Pay (ID payment) plug-in development/support
business for EC-CUBE, the Company plans to strengthen and improve theusability of EC-CUBE. At the same time, through enhanced synergies withAD HOOP and EC-CUBE, the Company plans to grow the EC PF segmentby expanding the e-commerce website building & operation support business.

w Gross margin worsened,but operating margin
improved thanks to
improvement of the
SG&A expenses ratio.

Trends in Overall Profit Margin
Partly due to M&As causing changes in the business mix, the gross margin
fell by 5.2 percentage points from 67.6% in the first half of the previous fiscal
year to 62.4% in the first half of this fiscal year (Figure 25). Meanwhile, the
SG&A expenses increased by +3.1%, which was much smaller than the rateof increase in sales (+14.6%), and consequently the SG&A expenses ratio
declined by 5.6 percentage points from 56.4% to 50.8%. As a result, the firsthalf’s operating margin rose by 0.4 percentage points from 11.2% to 11.6%.

【Figure 25】Transition in SG&A Expenses Ratio and Profit Margins (Unit: %)Gross margin

（％）

90.0
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
0.0
(10.0)

66.5

63.8

O.P. margin

70.8

65.3

64.7

18.3

66.9

49.3

42.1
24.4

70.0

71.4

59.9 65.9
45.4

SG&A expenses ratio

15.4
5.4

3.9

68.9

67.8

56.6

56.0

10.6

12.4

11.8

11.6

FY2020

FY2021

FY2022H1 FY2023

59.4

62.4

50.8

5.2

(5.5)
FY2014FY2015FY2016FY2017FY2018FY2019H2 FY2023(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. H1 = first half. H2 = second half.

Analysis of Factors that Increased/Decreased Profit in the First Half
Figure 27 shows an analysis of the factors that caused profit to increase or
decrease in the first half. As mentioned earlier, the sales growth of theMarketing PF (+Y73 million YoY) and the EC PF (+Y162 million YoY) werethe main factors causing profit growth, offsetting the increase in personnel
expenses for both segments (total of +Y184 million YoY), higher server
management expense due to the weaker yen (+Y31 million YoY), andincrease in other costs such as those due to inflation.

w Costs increased, especiallythe personnel expenses.
This was offset by the sales
growth, resulting inincreased profit.

【Figure 26】Breakdown of the Change in Sales and Operating 【Figure 27】Factors that Impacted Operating Profitof Each Segment in the First Half of FY2023
in the First Half of FY2023 (YoY comparison)
Sales

Operating Profit(Million yen)

450

(Million yen)

(Million yen)

300

162

1,600

400
350

1,200

200

800

200

400

50

0
Last
H1

-50
-100

To be
releasedduring thisfiscal year

200

0

Last
H1

This
H1

Last
H1

This
H1

Last
H1

This
H1

Conventional
businesses

Last
H1

This
H1

Last
H1

This
H1

Last
H1

This
H1

Last
H1

This
H1

E-commerce Website Building& Operation Support

Marketing Process Support

△128

-128

176

Personnel expenses owing tosubcontracting increased due tothe expansion of the ecommerce website building &operation support business.

100
50

H1 FY2022
Operating
Profit

17

-3
-31

150

0

This
H1

Incubation

-56
73

250

600

100

Decrease

300

1,000

150

Increase
-4

1,400

250

MarketingPF sales

EC PF
sales

-12

3

21

210

-9

Server expenses
increased due to theimpact of foreignexchange.

EC PF Transfer ofServerGoodwill
Cancellation Marketing
Travel andAdvertising Other
Rent
PF
personnel in-house maintenance amortization transportaion expenseof
expense expenses
expense developed
expenseintersegment personnel
expenses
assetsexpensesales(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. H1 = first half.

20/33This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

H1 FY2023
Operating
ProfitAlpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

Quarterly Change in Results
Both in the first quarter (Q1) and the second quarter (Q2) of this fiscal year,
sales and profit grew YoY at double-digit rates (Figure 20 on page 17). Profits
were at high levels and sales reached record highs for each quarter.

w Sales and profit grew atdouble-digit rates in bothQ1 and Q2. Profits werealso at high levels.

Regarding the quarterly trends in operating profit (Figure 28), in Q2 FY2019(January to March 2020) the Company became profitable for the first time inseven quarters. Since then, it has maintained an operating profit for 17
consecutive quarters in a row through Q2 FY2023 (January to March 2023).
The operating margin has also remained stably above 11% for 12 consecutive
quarters. However, although sales have continued to increase, the amount ofoperating profit for the last 12 quarters has remained within a boxed range of
83 million to 115 million yen.

w The past three years’quarterly operating
margin has been above
11%, but the amount ofoperating profit has stayed
within a boxed range.

【Figure 28】Quarterly Transition in Operating Profit(Million yen)

Strategic Investment Phase

Growth Phase

140
120
100

41

60
22 19

9

33

11

22

40

24

20

41 35 41
28 35 36

67 69

77

4
36

Acquired
AdRepo

35
38

39

19

21 17 16 34

46 30

27
26

13

45 50

(1)

17

17

60 52
25

0

(40)

Changedcompany
name

43
35

80

(20)

Acquired
ADPLAN

Stepwise withdrawal
from e-commerce
contract dev. business

15

Marketing Platform Business Segment

(38)

30

14 12

(8) (11)(44) (37)(23)

EC Platform Business Segment(15) (21)
(1)

9

3

33

8

80

79
51 51

47 53

65 70 72 62

74 71

86

15
(4)
Profit increased due to transfer toassets associated with major function
development

(5)

(3)

(60)

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summaryw Thanks to the business

transformation, it has beensteadily posting a profit
and its profit margins havebeen stable.

w At the beginning of the
fiscal year, the Company
had planned to increase
sales and profits andachieve record highs forsales and net profit.
w The Company revised its
financial forecast
downward. Now expecting
a large decrease in profit
despite a sales growth. The
amount of increase individend was also
reduced. Forecasts havebeen disclosed as ranges.

A steady posting of profit and stable profit margins have been achieved
thanks to the sales growth, as well as the firm support from AD EBiS’s profit,
withdrawal from the unprofitable businesses, improved profit of EC-CUBE,
acquisition of promising businesses, development of new businesses,
transition from a pay-as-you-go system to a subscription-based businessmodel, and the improvement of the gross margin and SG&A expenses ratio
through cost control.

◆ The Company’s Financial Forecast for FY2023 (full year
/ second half)
Full-Year Forecast
At the beginning of the fiscal year, the Company had planned for thefollowing full-year results: sales of Y3,900 million (+17.0% YoY), operating
profit of Y400 million (+1.9% YoY), recurring profit of Y390 million (-2.5%
YoY), and net profit of Y240 million (+1.7% YoY). It had planned for a
double-digit sales growth and a slight increase in net profit. Sales were
expected to increase for the 13th consecutive year and net profit as well as
sales was expected to hit record highs in a row.
However, when the results for the first half were announced (on May 8, 2023),
the annual sales for this fiscal year were revised downward by 200-300
million yen to Y3,600-3,700 million (+8.0% to +11.0% YoY; a record highis still expected). In addition, operating profit was revised downward by 7021/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

120 million yen to Y280-330 million (-16.0% to -28.7% YoY), recurring
profit was revised downward by 60-110 million yen to Y280-330 million (17.5% to -30.0% YoY), and net profit was revised downward by 40-70
million yen to Y170-200 million (-15.3% to -28.0% YoY). Along with thesechanges, the forecast for dividend per share was also revised down from 7.8
yen to 7.4 yen (however, this dividend is still 0.4 yen greater than the previous
fiscal year).
The main reason for these downward revisions is that, as mentioned earlier(on page 18), the number of accounts of AD EBiS fell far below expectations
due to difficulties in acquiring new customers as the media environmentchanged, including the increasing market domination by the major media.
The average unit price appears to have been largely in line with the plan, but
the churn rate remained flat and did not improve, which was presumably
another negative factor.

w The main reason for the
downward revision is thatthe acquisition of new
customers for AD EBiS fell
short of the plan.

BOKUBLOCK’s results are expected to exceed the initial forecast, and thebusinesses other than AD EBiS are expected to mainly offset each other.
Strategy for This Second Half
The Company’s strategy for the second half is to 1) continue to revitalize theconventional businesses in the area of advertising effectiveness measurement
to further strengthen them as its revenue base and 2) utilize the existing
resources to develop and launch new services in each segment (priority
strategies 1 & 2 in Figure 29), thereby achieving growth.

w The strategy for the second
half is to strengthen theconventional businesses as
its revenue base and to
begin providing the newservices.

The Company had planned to increase the sales proportion of the newservices from 14% in the previous fiscal year (sales: approx. Y467 million)
to 23% in the current full fiscal year (initial forecast for sales: approx. Y897
million). However, 23% was already achieved in the first half (estimated salesof Y417 million) ahead of schedule, so it is now targeting greater than 23%
for the full fiscal year.

w The sales proportion of the
new services rose to 23%,
achieving the initial goal.
High growth has been
maintained.

【Figure 29】Strategy for This Fiscal Year’s Second Half

Generate stable revenue through mainly AD EBiS
➊ Conventional
businesses*

Planning to release a post-cookie solution in the second
half for the vitalization of advertising effectivenessmeasurement
Priority
Strategy

1

EC PF
New

・Strengthen e-commerce website building &operation support
・Increase/enhance resources through M&As tostrengthen project execution capacity

MPF
New

・Planning to release a new service for achieving
accelerated growth over the medium/long term
・Planning to invest in development based ontransfers from the conventional businesses➋ New Services
Priority
Strategy2

BasicStrategy

Maximally utilize
the existing
resources

Aim to achieve growth through the vitalization of ad effectiveness measurement
and the expansion of the new services(Ref) Financial results briefing materials.
(Note) *The conventional businesses include MPF’s advertising effectiveness measurement and advertising agency DX and EC PF’s EC-CUBE.

22/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18
w A slight increase in sales anda large decrease in profit areplanned for the second half.

Plan for the Financial Performance in the Second Half
The Company’s second-half plan (calculated from the average values of the
full-year forecast) is as follows: sales of Y1,838 million (+Y85 million or+4.8% compared to the second half of the previous fiscal year), operating
profit of Y95 million (similarly, -Y121 million or -56.2%), and net profit of
Y54 million (similarly, -Y78 million or -59.1%). It is expecting a slightincrease in sales and a large decrease in profit.
Compared to the first half of the current fiscal year, too, the second half ofthe current fiscal year is expected to similarly experience a slight increase insales (+Y26 million or +1.4%) but a large decrease in profit (operating profit:-Y115 million or -54.8%).

w The operating margin is
expected to drop sharply inthe second half. The
Company’s forecast seems
somewhat conservative.

w The full-year forecast has
been announced as ranges
based on the two underlying
factors: new customer
acquisition for AD EBiS andsales of e-commerce website
building & operation
support.

w Plans to start providing two
services in Q4 in theMarketing PF, but they are
not included in the sales
forecast for this fiscal year.

Regarding the operating margin, the Company is expecting it to worsen from
11.1% in the first half of FY2022, 12.3% in the second half of FY2022, and11.6% in the first half of FY2023 to 5.2% in the second half of FY2023.
Because AD EBiS, its revenue source, has a high marginal profit ratio, it
seems to be expecting the downward revision of AD EBiS’s sales to cause
the overall profit margin to worsen. In addition, the Company seems to be
expecting the profit margin to worsen due to upfront investments such as
those for development and increasing employees and due to the increase incosts caused by inflation. However, these expectations seem somewhat
conservative.
The full-year (revised) forecast has been disclosed as ranges, depending on
the underlying conditions of the second-half forecasts.
・Upper limit: If new customers are gained for AD EBiS as initially planned& the sales of e-commerce website building & operation support exceed
the initial plan
・Lower limit: If the new customer acquisition for AD EBiS is only about thesame as the first half & the sales of e-commerce website building &operation support are in line with the initial plan
Note that specific numbers have not been disclosed for the underlined parts.
In the Marketing PF, the Company plans to release a post-cookie solution
and launch a new service for marketing process support in Q4. However,neither of these services are included in the sales forecast for the second halfof this fiscal year. The details of both services have not been announced yet,but both are expected to be subscription-based businesses.
The post-cookie solution will provide a service in the low price range thatleverages the existing technologies. Complementing AD EBiS, which has arelatively high unit price and multiple functions, it is aimed at expanding the
product lineup and creating synergies in the area of advertising effectivenessmeasurement. The Company hopes this to become a gateway product for
promoting cross-selling and acquiring new customers for AD EBiS (note that
this product/service is not simply a cheaper version of AD EBiS, equippedwith a part of its functions, that may lead to cannibalization).
Marketing process support is a promising service that the Company aims
to develop as its new source of revenue. Significant growth is expected forthis service as part of its medium- to long-term management plan as well.

23/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

Current Situation (monthly sales)
Figure 30 shows the monthly sales trend for the current fiscal year as
announced by the Company.

w The monthly sales
momentum (YoY) is
declining.
w Sales in April, the first monthof the second half, showed anincrease of 4.6% YoY. The
Company expects a sales
growth of 2.0% to 7.7%
(average: +4.8%) in the second
half, so this is in line with its
expectations.

From the beginning of this fiscal year through March, it had maintained adouble-digit sales growth (YoY), but the sales growth momentum has beensomewhat dwindling compared to the past several years’ track record.
In April, the first month of the second half, company-wide sales were Y306
million, having grown by 4.6% YoY at a single-digit growth rate. However,on a company-wide basis, this increase in sales is within the expected range
for the second half (YoY: +2.0% to +7.7% at an average of +4.8%).

【Figure 30】Recent Monthly Change in Sales (flash report)(Upper row is sales; unit = thousand yen)
(Lower row is YoY change; unit = %)Calendar Year
Fiscal Year
Monthly Sales (thousand yen)
Marketing Platform
EC Platform
Entire Company

2022
Oct
248,293
106.5
49,525
157.4
297,819
112.6

2023
Nov
248,744107.6
42,736180.0
291,480114.3

Dec
244,462
105.1
45,528185.3
289,999112.7

FY2023
Jan
242,066
104.6
61,129176.2
303,196114.00Feb
250,282
102.2
63,030260.2
313,313116.4

Mar258,554104.8
57,750256.7
316,335117.5

Apr
244,070
93.9
61,480191.1
305,550
104.6

This Fiscal YearYTD (Oct 2022 - Apr
2023)

1,736,471
103.4
381,178
197.1
2,117,692
693.1(Ref) Prepared by Alpha-Win Research Dept. based on the monthly announcements posted on the Company’s website.
(Note) The values shown for April are preliminary data before an audit by an auditor and may become revised in the future.

w Marketing PF’s sales in April
decreased YoY.

By business segment, in April, the monthly sales of the main Marketing PF
segment decreased by -6.1% YoY, turning to a negative trend from the approx.
+2% to +8% sales growth rate maintained from October 2022 to March 2023of this fiscal year.
Since the sales of the incubation and advertising agency DX businesses ofthis PF appear to be solidly growing, the sales decline is presumably due todecreased sales of the advertising effectiveness measurement business. The
downward trend in the number of AD EBiS’s accounts may still be continuingin the second half.

w A high growth has been
maintained for the sales of
the EC PF.

In the EC PF, sales have been strong with a steadily high growth rate in April,thanks to BOKUBLOCK, the company that became a consolidated subsidiaryin June 2022 (e-commerce website building & operation support).

24/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18◆ Alpha-Win Research Dept.’s Financial Forecast for
FY2023 (full year)
w Considering the results of thefirst half and the current
situation, we have revised ourfinancial forecasts downward.
w Our new forecasts are within
the range of the Company's
new forecasts.

Revisions to This Fiscal Year’s Forecast
Based on the results of the first half, the current situation, and interviews with
the Company, we revised down our sales and profit forecasts for the full fiscal
year (Figure 31 on page 26).
In the order of our previous forecast ⇒ our current forecast, we revised thisfiscal year’s sales from Y3,800 million ⇒ Y3,650 million, operating profit
from Y400 million ⇒ Y310 million, and net profit from Y240 million ⇒Y190 million. As a result, our new forecasts are now within the ranges of theCompany’s revised forecasts. Compared to the average values of the ranges,
sales are the same but operating profit is slightly higher (by +Y5 million).
The uncertainties include the sales and costs associated with acquisitions ofcompanies and businesses and the rise in various costs due to inflation.
However, we have assumed that there will be no new M&A in this second
half.

w The Company’s forecasts forthe second half seem
somewhat conservative.

w Details of the post-cookie
solution and the marketing
process support service thatwill be newly launched are
unknown. Their impact on
the business results of thecurrent fiscal year is expected
to be limited.

w While we raised the full-year
forecast for the average unit
price of AD EBiS, we lowered
our prediction of its numberof accounts.

We made our forecast for the current fiscal year based on the following
estimates and predictions.
1. Based on the sales growth rate in April and the current situation, we
predict that the sales in the second half will generally be in line withexpectations. In addition, the Company’s forecast seems somewhat
conservative in that it expects the operating margin in the second half
to drop sharply from 12.3% ⇒ 5.2% (based on average values) and theoperating profit to decrease by 56.0% (similarly, based on the average)
compared to the second half of the previous fiscal year. There also
seems to be room for cost control, so we believe that the risk of falling
below the lower end of the range is small.
2.

As mentioned earlier, in the Marketing PF segment, the Company plans
to introduce a post-cookie solution and launch a marketing process
support service in Q4. However, like the company forecast, we have notfactored their sales into our forecasts. This is because information on
their pricing system and service content has not been disclosed yet,making forecasting of their sales difficult. Also, their impact on thecurrent fiscal year’s results is likely to be limited in terms of the lengthof period (contributing to the results for a maximum of three months).
Since they will be subscription-based businesses, we believe that there
will a time lag in terms of their reflection in the results, which will most
likely begin starting in the next fiscal year at the soonest.

3.

Regarding the annual average unit price of AD EBiS (average value atthe end of each quarter), we have estimated them based on the resultsof the first half (167,976 yen as of the end of Q2). We have raised ourforecast from 165,000 yen in our previous forecast ⇒ 168,000 yen in
our current forecast (compared to the previous fiscal year’s average unit
price: +9,473 yen or +6.0%). The Company has kept the price of AD
EBiS Sync unchanged, but due to upselling and changes in the customer
mix, its average unit price has risen more than we had expected.
On the other hand, the number of accounts has continued to decline,
falling short of what we had expected.
25/33This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

As with the average unit price, based on the results of the first half (1,121
accounts as of the end of Q2), we have revised down the predicted
number of accounts for the year from 1,160 accounts in our previous
forecast ⇒ 1,090 accounts in our current forecast (compared to theaverage number of accounts in the previous fiscal year: -141 accounts or-11.5%).
Consequently, we revised down AD EBiS’s full-year sales forecast from
Y2,297 million ⇒ Y2,200 million by about Y100 million. Since AD
EBiS has a high marginal profit ratio, the corresponding profit has also
been reduced by about Y70 million.
w The main reason for our
downward revision is thereassessment of theestimates for AD EBiS.

Our downward revision of sales and profits for this fiscal year from ourprevious forecast is mainly due to the reassessment of the estimates for
AD EBiS.

【Figure 31】Alpha-Win Research Dept.’s Revised Forecast for This Fiscal Year and MediumTerm Forecast(Million yen)

FY2022 A

Sales
I. Marketing PF
II. EC PF
Gross Profit
Gross Margin
SG&A Expenses
Ratio to sales
Operating Profit
Ratio to sales
Recurring Profit
Ratio to sales
Net Profit
Ratio to sales
Sales (YoY growth rate)
I. Marketing PF
II. EC PF
Gross Margin (diff. from last FY)
SG&A Expenses (growth rate)
Operating Profit (growth rate)
Recurring Profit (growth rate)
Net Profit (growth rate)
EBITDAKPIAD EBiS: # of active accounts% change for the above
AD EBiS: average unit price (yen)% change for the above
I. (1) Ad Measurement (AD EBiS):
Actual/Forecasted Sales

FY2023 New CE

FY2023 New CE

FY2023 New E

FY2024 New E

FY2025 New E

FY2023 Old E

FY2024 Old E

FY2025 Old E

3,334
3,900
3,650
3,650
4,000
4,350
3,800
4,320
5,000
2,925
3,260
2,970
3,235
3,530
3,137
3,507
4,036
414
640
680
765
820
670
810
965
2,260
2,410
2,310
2,455
2,660
2,320
2,610
2,880
67.8%
61.8%
63.3%
61.4%
61.1%
61.1%
60.4%
57.6%
1,867
2,010
2,000
2,125
2,300
1,920
2,150
2,350
56.0%
51.5%
54.8%
53.1%
52.9%
50.5%
49.8%
47.0%
392
400
305
310
330
365
400
460
530
11.8%
10.3%
8.4%
8.5%
8.3%
8.4%
10.5%
10.6%
10.6%
399
390
305
310
330
365
390
450
520
12.0%
10.0%
8.4%
8.5%
8.3%
8.4%
10.3%
10.4%
10.4%
236
240
185
190
200
220
240
300
340
7.1%
6.2%
5.1%
5.2%
5.0%
5.1%
6.3%
6.9%
6.8%
12.7%
17.0%
9.5%
9.5%
9.6%
8.7%
14.0%
13.7%
15.7%
12.5%
11.5%
1.5%
8.9%
9.1%
7.2%
11.8%
15.1%
15.6%
54.5%
64.2%
12.5%
7.2%
61.8%
20.9%
19.1%
-1.2%
-6.0%
-4.5%
-1.9%
-0.2%
-6.7%
-0.6%
-2.8%
11.6%
7.7%
7.1%
6.3%
8.2%
2.8%
12.0%
9.3%
7.4%
2.0%
-22.2%-20.9%
6.5%
10.6%
2.0%
15.0%
15.2%
9.6%
-2.3%
-22.3%
6.5%
10.6%
-2.3%
15.4%
15.6%
-1.2%
1.7%
-21.6%-19.5%
5.3%
10.0%
1.7%
25.0%
13.3%
677
680
618
625
645
675
680
760
850
Annual Average Annual Average Annual Average Annual Average Annual Average Annual Average Annual Average Annual Average Annual Average
(A)
(E)
(E)
(E)
(E)
(E)
(E)
(E)
(E)
1,231
Slight decline
1,090
1,100
1,115
1,160
1,170
1,185
-8.4%
-11.5%
0.9%
1.4%
-5.8%
0.9%
158,527
Slight increase
168,000
175,000
185,000
165,000
175,000
185,000
10.2%
6.0%
4.2%
5.7%
4.1%
6.1%
5.7%
2,369

2,460

I. (4) Post-Cookie: Sales

2,200

2,310

2,475

0

25

50

2,297

2,457

2,631

I. (2) Advertising Agency DX: Sales

175

180

190

200

205

190

200

205

I. (3) Incubation: Sales

380

620

580
0

650
50

700
100

650

850

1,200

2,925

3,260

2,970

3,235

3,530

3,137

3,507

4,036

414
330

640
350

680
345

765
365

820
370

670
350

810
360

965
370

84

290

335

400

450

320

450

595

I. (5) Marketing Process: Forecasted Sales
I. Marketing PF （1）+（2）+（3）+（4）+（5）II. EC PF （1）+（2）(1) EC-CUBE(2) E-commerce website building & operation support;
BOKUBLOCK(Ref) Prepared by Alpha-Win Research Dept. based on the financial results summary and briefing materials.
(Note) CE: the Company’s forecast/estimate. E: Alpha-Win’s forecast/estimate. Alpha-Win’s estimates for AD EBiS’s average unit priceand number of active accounts are annual averages and therefore they differ from the Company’s announced estimates (which are averagesof the end of the last month of each quarter). Actual results (A) are simple averages of end-of-the-quarter figures.

26/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

7．Growth Strategy◆ The Company’s Medium- to Long-Term Business Planand Strategy
w Aiming for acomprehensive marketing
DX support business

w Planning to develop
multiple new services, inaddition to accelerating thedevelopment of its
conventional businesses,
through in-housedevelopment and M&As
w The numerical targets forthe final year of themedium-term plan (FY2023:
this fiscal year) have been
lowered in steps.

Medium-Term Business Plan (VISION 2023): Strategy
The Company has set out a plan called the MXP (Marketing Transformation
Platform) strategy. In this strategy, the Company plans to evolve its business
to not only provide specific services to its client companies but also provide
the optimal service as a comprehensive marketing DX support business.
By leveraging the strengths that it has built, as well as through in-housedevelopment and M&As, the Company plans to accelerate the growth of its
conventional services and develop multiple new services in the Marketing PF
and EC PF segments. It will thus aim to maximize its group’s assets andsynergies, thereby accelerating its growth.
Medium-Term Business Plan (VISION 2023): Numerical Targets
For the final year of its medium-term business plan (VISION 2023), or
FY2023 (this fiscal year), the Company had planned to achieve the following
goals: sales of Y5 billion, operating margin of 15%, operating profit of greaterthan Y750 million, and DOE of 3% or greater (Figure 32). These were revisedat the beginning of this fiscal year and at the time of the announcement of thefirst-half results in February of this year, resulting in the current forecast.

【Figure 32】Numerical Targets of the Long-Term Business Plan(as of the date of their announcement)
Consolidated
Sales

Consolidated
Operating Margin

FY2020 Results

Y2.61 billion

10.6%

2.0%

FY2021 Results

Y2.95 billion

12.4%

2.3%

FY2022 Results

Y3.33 billion

11.8%

2.6%

FY2023
Old Medium-Term
Financial Targets

Y5.0 billion

15%3% or more

FY2023
Revised Financial
Targets

Y3.9 billion

10%2.5% or more

FY2023Re-revised Financial
Targets

Y3.6-3.7
billion

7.8-8.9%

2.5%

Dividend on
Equity(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials
with partial additions/edits.
(Note) The “revised” forecast is the forecast made at the beginning of this fiscal year and the“re-revised” forecast is the forecast after the first half of this fiscal year.

w Added the sales proportionof the new services as a
KPI.

Regarding the KPIs, the proportion of the new services (Marketing PF’s
incubation + EC PF’s e-commerce website building & operation) in the
consolidated sales has been added as a KPI. It plans to raise this proportion
from 3% in FY2021, 14% in FY2022, and 23% in the first half of FY2023 toover 23% for this full fiscal year (previous goal was 30%) (Figure 33 on page28).
The new medium-term management plan for the next fiscal year onwards will
mostly likely be announced at the same time as the announcement of thefinancial results for the current full fiscal year.
27/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18【Figure 33】Change in the Proportion of the New Services
I. MPF （1） Adverting effectiveness measurement
I. MFP （2） Advertising agency DX
I. MPF （3） Incubation
II. EC PF （1） EC-CUBE
II. EC PF （2） E-commerce website building & operation support

Proporion of the newservices (%)

More than 23％
23％
FY2023(forecasted
range)

14％
10％

Proporion of the
new services (%)

8%

3％
FY2021(result)
Y2.95 billion

MPF: Y2.59 billion
EC PF: Y350 million

FY2022(first-halfresult)Y1.58 billion

FY2022(Q1 result)
Y780 million

MPF: Y700 million
EC PF: Y80 million

MPF: Y1.42 billion
EC PF: Y160 million

FY2022(result)
Y3.3 billion

MPF: Y2.92 billion
EC PF: Y410 million

FY2023(first-halfresult)Y1.81 billion

MPF: Y1.49 billion
EC PF: Y320 million

Y3.6-3.7
billion

MPF: Y2.97 billion
EC PF: Y680 million(Ref) Prepared by Alpha-Win Research Dept. based on the financial results briefing materials. This fiscal year’s forecasts arefrom the Company’s plan. This fiscal year’s sales forecasts for each segment are values estimated by Alpha-Win.
(Note) The proportion of the new services is the proportion of the sum of the sales of incubation and e-commerce website
building & operation to the overall consolidated sales. “MPF” stands for the Marketing PF.

w The Company aims to achievesales of Y10 billion at an earlystage through stable growth of
its conventional businesses
and expansion of the newservices.

w The marketing process support
business, which is expected to
become the future growth
driver, is planned for releaseduring this fiscal year’s Q4.

w

Early Achievement of Y10 Billion in Sales
Under it medium- to long-term theme of “achieving the goal of Y10 billion
in sales as a corporate group of comprehensive marketing DX support,” theCompany envisions the stable growth of its conventional businesses(advertising effectiveness measurement, advertising agency DX, and ECCUBE) and the expansion of new services in three areas (incubation, ecommerce website building & operation support, and marketing process
support) (Figure 34).
Regarding the marketing process support service, which is expected to growsignificantly and become a significant portion of the Company’s entire
business in the future, it is currently under development for its release in Q4.
The details of its service content and pricing system, as well as its businessmodel, have not been disclosed yet, but its concept is to “provide a cloudservice that helps facilitate the entire marketing process.”【Figure 34】Image of Sales Growth over the Medium to Long Term
Sales

10B yen

MPF

Marketing Process
SupportEC

E-commerce Website
Building & Operation
SupportMPF

Now
Incubation

Ad EffectivenessMeasurement

Ad Agency DX

EC-CUBE

Conventional
businesses(Ref) From the financial results briefing materials, with partial edits.

28/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18◆ Alpha-Win Research Dept’s Forecast of Financial

Results over the Medium Term
w We have reviewed ourforecasts for the three fiscal
years starting this fiscal
year and have revised themdownward.

w From the next fiscal year
onwards, we expect sales,
profits, and dividends toincrease.

Medium-Term Forecast
In addition to this fiscal year’s forecasts, we have reviewed our previous
forecasts for the next fiscal year and the fiscal year after the next. We
especially reassessed our estimates for the Marketing PF, including AD EBiS
(its number of accounts), and also reviewed our estimates for the EC PF. As
a result, we made an overall downward revision to our forecasts (Figure 31
on page 26).
However, in FY2024 and FY2025, we expect both sales and profits toincrease, dividends to rise, and record-high sales to be reached consecutively.
This is because the upfront investments will come to an end of a phase, thesales growth of the new services (especially incubation and e-commerce
website building & operation support) is expected to lead to increased profits,
AD EBiS’s sales are expected to bottom out, the release of the post-cookie
solution will help maintain the sales of the advertising effectivenessmeasurement business, and sales growth are expected from the marketing
process support.
For the Marketing PF, the Company’s main business, we have not changed
our prediction of the annual average unit price of AD EBiS (excluding thepost-cookie solution which will be in the low price range). Meanwhile, wechanged our prediction of its number of accounts (annual average) from 1,170⇒ 1,100 for FY2024 and 1,185 ⇒ 1,115 for FY2025. In line with this, we
also revised downward the sales forecast for AD EBiS for both fiscal years.
For FY2024 (the next fiscal year), we made downward revisions to ourforecasts as follows: sales from Y4,320 million ⇒ Y4,000 million, operating
profit from Y460 million ⇒ Y330 million (operating margin from 10.6% ⇒8.3%), and net profit from Y300 million ⇒ Y200 million (Figure 29 on page
26).
Similarly, our forecasts for FY2025 (the fiscal year after the next) wererevised downward as follows: sales from Y5,000 million ⇒ Y4,350 million,
operating profit from Y530 million ⇒ Y365 million, and net profit from Y340
million ⇒ Y220 million.

w We expect the DOE to be
2.5% for the time being.

Regarding dividends, we assumed that the DOE will be 2.5% for both fiscal
years as with our previous forecast. In line with the change in our profit
forecast, we revised the expected dividend downward, but we have notchanged our forecast that dividend will continue to be increased along withthe growth of profit.
Note that once the upfront investments settle down, the Company may raiseits dividend goal back again to the previous DOE target of 3.0%.
Currently, the Company is in the stage of shifting resources to new or relatedareas of business by using the cash flow from its conventional businesses.

w Over the medium term, wepredict an annual profit
growth rate of about 10%.

Going forward, in addition to the organic growth of its conventional
businesses, accelerated growth is expected through the development of the
new businesses, active engagement in M&As, and synergies created fromthem. Over the medium term, we believe that the Company may be able tomaintain an annual profit growth rate of about 10% (previously, we had
predicted 15-20%).
29/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

Whether there will be M&As and whether those M&As will be successful(PMI) are the factors that may cause changes in financial performance in the
future.
w At present, it is difficult toforecast the sales of the
post-cookie solution andthe marketing process
support, for which details
have not been disclosed
yet, but a certain amount
has been reflected in our
forecast.
w We plan to update our
medium-term forecast
again in the next fiscal year
or later, when the details
and trends of the newly
launched services are
expected to become
revealed.

As mentioned earlier, in Q4 of this fiscal year, the Company plans to releasea post-cookie solution, as well as a marketing process support service for thecreation of a new source of revenue, in the Marketing PF. However, theirimpact on business performance in the next fiscal year onwards is difficult toevaluate at this moment because information such as the service content,
customer reactions, and pricing has not been disclosed yet.
Since the post-cookie solution and marketing process support are newservices, though, in addition to being based on cloud-based subscription
models, we do not expect their impact on sales and profits to be large in thenext fiscal year or the year after that.
We hope to update our medium-term financial forecast as appropriate when
the details, price range, and business performance become more revealed
starting in the next fiscal year.

30/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18

8． Analyst’s View
◆ Shareholder Returnw For this fiscal year, thedividend amount has beenrevised downward due tothe downward revision of
profit. However, theCompany still plans toincrease dividend
compared to the previous
fiscal year. The DOE ismaintained at 2.5%.

w Dividend is expected toincrease in the next fiscal
year onwards too.

At the beginning of the fiscal year, the Company had planned to increase
dividend from 7.0 yen/share in the previous fiscal year to 7.8 yen/share in thecurrent fiscal year (+0.8 yen/share). However, due to the downward revisionof the financial performance, dividend was lowered to 7.4 yen/share (+0.4
yen/share compared to the previous fiscal year), since a consolidated dividendon equity ratio (DOE) of 2.5% is set as the guideline for deciding the amountof dividend.
We, too, reviewed our financial forecast for this fiscal year and lowered ourdividend forecast to 7.0 yen/share, which is the same as the Company. We
also revised our financial forecast for FY2024 and FY2025 and revised their
expected dividend based on a DOE of 2.5%.
However, since the YRGLM Group is still in its growth stage, we predict that
it will return to a profit growth trend starting in the next fiscal when it will
start to see the effects of its investment, which will likely lead to dividend
hikes (Figure 32).

【Figure 35】Change in Dividend and Dividend Payout Ratio
Dividend (left axis)(Y)

Dividend payout ratio (right axis)

DOE (right axis)

10.0

50.0
8.9

43.2

9.0

8.3

8.0
7.0

7.0
6.0
5.0

5.0

30.0

4.0

24.5

13.8

12.2

1.0

26.1

25.4

2.1

2.8

2.6

FY2015FY2016FY2017

0.0

0.0

0.0

0.0

0.0
FY20180…
FY2019

25.0
20.0

18.6

18.7

3.0

0.0

35.0

5.2

5.0

45.0
40.0

7.4

4.5

4.0

2.0

（％）

15.0

13.7

10.0
5.0

2.0

2.3

2.6

FY2020

FY2021

FY2022

2.5

2.5

2.5
0.0

FY2023 E FY2024 E FY2025 E(Ref) Prepared by Alpha-Win Research Dept. E: Alpha-Win’s forecast/estimate.

◆ Stock Price, Trends, and Factors that May Affect Stock
Price(11) Ad-technology: A generalterm for information
technology used in theadvertising business, referringto the digital technologies usedin Internet ads, etc.
w Volatility of stock pricehas been high.
w Stock price weakened
following theannouncement of thedownward revision tofinancial results.

Stock Price and Trends
The Company’s stock is a small-cap, ad-technology11-related stock listed on
the TSE Growth Market. Since becoming listed, the volatility of its stock
price has been high (intraday stock price was at a max of 5,770 yen in
November 2014 and a min of 581 yen in May 2023).
Upon announcing the financial results for the first half of the fiscal year, theCompany revised down its financial forecast for the full fiscal year. In
response to this, the stock price decreased and hit the lowest price since
becoming listed on the market. The stock price is currently being adjusted in
the low price range.
Since the beginning of the year, the stock price has been underperforming the
major indexes such as the TSE Growth, Mothers, and TOPIX (Figure 34 on
page 32).
31/33

This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18【Figure 36】Comparison of Valuation and Performance
Closing price on May 31, 2023

Stock price or
index

YRGLM (G 3690)

This fiscal year's
forecasted P/E

Actual P/B

Simple average ofdividend yield

Return since thebeginning of the year

Return since the endof April 2023

Return since
May 8, 2023

585

19.37

1.97

1.26

-9.58

-7.6

TSE Prime Stock Average: P

1,096.42

14.53

1.24

2.36

12.65

3.6

2.9

TSE Standard Stock Average: S

1,064.93

14.59

0.94

2.28

6.99

0.2

-1.2

TSE Growth Stock Average: G

951.61

63.32

4.23

0.40

2.56

0.4

-0.9

TOPIX

2,130.63

12.63

3.6

2.9

TSE Mothers

748.06

2.42

0.4

-0.9

Nikkei Stock Average

30,887.88

18.4

7.0

6.7

14.09

1.27

2.07

-17.4

(Ref) Prepared by Alpha-Win Research Dept. Actual P/B: as of the end of the first half of the fiscal year ending September 30, 2023, for theCompany and as of May 31, 2023, for others. The Company's P/E is based on Alpha-Win’s EPS forecast. Note that May 8, 2023, wasthe date on which the financial results for the first half were announced.

(12) P/S: Ratio of stock price tosales = market capitalization /sales
w Valuation is higher than
the TSE Prime’s averageand lower than the TSE
Growth’s average.

(13) PEG: P/E ÷ Expected
medium-term profit (EPS)
growth rate (per year)

w Valuation is slightly highin terms of the major
indicators, but within areasonable range. The
future stock price is
expected to have thepotential to rise over the
medium to long term,
depending on the level ofprofits and dividends.

w For the stock price to rise,
the Company will need toachieve the forecasted
financial results for thisfiscal year and return to a
profit growth trend fromthe next fiscal year
onwards.

Valuation
Based on this fiscal year’s financial forecast, the Company’s valuation is asfollows: forecasted P/E of 18.36 to 21.59, actual P/B of 1.97, forecasted P/S12
of 1.01 to 1.04, and a forecasted dividend yield of 1.26% (forecasts are basedon the forecasted ranges of the Company’s plan)
The valuation of the Company’s stock is slightly high compared to theaverage of all stocks on the TSE Prime Market (P/E of 14.53, P/B of 1.24,
and simple dividend yield of 2.36%). On the other hand, it is undervalued
compared to the average of all stocks on the TSE Growth on which it is listed(P/E of 63.32, P/B of 4.23, and simple dividend yield of 0.40%).
Its EV/EBITDA is estimated to be 4.5 for the current fiscal year, 4.4 for
FY2024, and 4.2 for FY2025 (Alpha-Win’s forecasts), which seem to bewithin the common range (about 2 to 8). Also, if the medium-term profit
growth rate is 10%, the PEG13 would be around 1.8 to 2.2, so the stock does
not seem overvalued.
The evaluation of the Company as a domestic-demand-oriented growth stock
related to ad-tech/subscription businesses seems to be already reflected in thestock price to a certain extent. Based on the new forecast for this fiscal year,
its valuation appears be within a reasonable range in terms of the major
indicators. Consequently, the stock price is expected to change in the future
depending on the level of profit and dividend in the next fiscal year onwards.
Whether the new services, which are expected to become the growth drivers,
will succeed is the key factor that may impact financial performance.
However, considering the medium-term profit growth potential of theconventional businesses and the potential for future dividend hikes, we
believe that the stock price has the potential to rise over the medium- to longterm.
The stock price may rebound if investors once again begin to have highexpectations of this fiscal year’s financial forecasts being achieved and of the
future profit growth potential (based on our revised financial forecast, theforecasted P/E is 19.3 for this fiscal year, 18.4 for FY2024, and 16.7 for
FY2025).

32/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.

Alpha-Win Company Research ReportYRGLM Inc. (3690 TSE Growth)

Issued: 6/5/2023

2018/12/1820182018/12/1820152018/12/182018/12/182018/12/18
w Key factors impacting thestock price are AD EBiS’s
number of accounts, unit
price, and churn rate; thecontribution of the newservices to the financial
performance; M&As; anddividend.

Key Points Going Forward
・The following are the factors that may impact the stock price and areconsidered to be the key points to watch.
1.
2.
3.
4.
5.
6.
7.
8.

w We will continue to follow
the Company as adomestic-demand-oriented
growth stock in themarketing DX support
business.

AD EBiS’s number of active accounts (when it will turn from a net
decline to a net growth), unit price (amount and rate of growth), andchurn rate (KPI)
The proportion of the new services’ sales to the consolidated sales (KPI),
as well as the content of new services that are planned to be launched
and their contribution to the Company’s financial performance
Trends in monthly sales (YoY comparison for both PFs)
Quarterly trends in profit/loss (profit growth rate, profit margins,
EBITDA, and changes in sales and profit per segment)
The financial results for this full fiscal year and the profit forecast for
the next fiscal year onwards (the timing when it will begin increasing
profit again)
Measures to return profit to shareholders
Announcements of M&As or alliances
Strengthened regulations such as those for the protection of personal
information

Since it is a small-cap growth stock, the volatility of financial performanceand stock price is likely to remain high. However, over the medium to longterm, the Company’s business has a large growth potential since the Internet
advertising market and the e-commerce market are expected to continue toexpand. We hope to follow the Company’s development, as well as its change
in sales and profit growth rates, as a domestic-demand-oriented growth stockin the business of marketing DX support that is not directly largely impacted
by COVID-19, overseas situations, inflation, and exchange rates.

33/33
This Alpha-Win Company Research Report (hereinafter “this Report”) has been prepared by Alpha-Win-Capital Inc. (hereinafter “Alpha-Win”) on the request of the company presented inthis Report for the purpose of providing a description of the company. This Report is not to be construed as a recommendation or solicitation of investment. Contents of this Report are basedon information current as of the issue date and are subject to change without notice. We do not warrant or represent that the information in this Report is accurate, reliable, complete,appropriate, or fit for any purpose and do not accept any responsibility or liability. Alpha-Win shall not be liable for any consequences including direct or indirect loss, lost profit, or damage
resulting from the use of or reliance on this Report. Investors who read this report must make their own decisions on all investment matters and take full responsibility regarding theirinvestment. Intellectual property of this Report belongs to Alpha-Win and no part of this report may be copied, photocopied, cited, or translated without our consent.