[Translation: Please note that the following purports to be an accurate translation of excerpt contents of the original Japanese document, preparedfor foreign shareholders solely as a reference material. In case of any discrepancy between the translation and the Japanese original, the latter shallprevail. Please also be advised that certain explanations for the domestic voting procedures are omitted or modified in this translation. The English
names of programs and events contained in this document are provisional translations and subject to possible future change.]

Securities Code: 9401
June 3, 2024

Dear Shareholders:

TBS HOLDINGS, INC. (the “Company”)
Takashi Sasaki
President and Chief Executive Officer
5-3-6 Akasaka, Minato-ku, Tokyo
Notice of Convocation of the 97th Ordinary General Meeting of Shareholders
We are pleased to announce the 97th Ordinary General Meeting of Shareholders of theCompany, which will be held as described below.
In convening this General Meeting of Shareholders, we have taken measures toprovide the contents of the Reference Documents for the General Meeting of Shareholders inelectronic format (matters to be provided in electronic format), which are posted on each of
the following websites. Please access any of these websites to confirm the contents.
[The Company’s website]
https://www.tbsholdings.co.jp/ir/stakeholders/meeting.html[Website for posting Materials for the General Meeting of Shareholders]
https://d.sokai.jp/9401/teiji/
If you do not attend the meeting, you may exercise your voting rights via the Internet
or in writing (by mail). Please review the Reference Documents for the General Meeting of
Shareholders, and follow the procedures below to exercise your voting rights by 5:30 P.M. on
Wednesday, June 26, 2024 (JST).
Exercise of voting rights via the Internet
Please access the website for exercising voting rights designated by the Company(https://evote.tr.mufg.jp/ in Japanese only) and follow the instructions on the screen to enter
your approval or disapproval of the proposals by the above-stated deadline for exercising yourvoting rights.
Exercising Voting Rights in Writing (by Mail)
Please indicate your approval or disapproval of the proposals on the Voting Rights
Exercise Form and send it to the Company so that it arrives by the above-stated deadline forexercising your voting rights.

[English Translation]1

Details
1. Time and Date of the Meeting

10:00 A.M. [Thursday], June 27, 2024
(the reception will start at 9:00 A.M.)

2. Place of the Meeting

TBS Akasaka BLITZ Studio
5-3-2 Akasaka, Minato-ku, Tokyo, JAPAN3. Purpose of the Meeting
Matters for Reporting:1.
Report on the business report, the consolidated financial statements and the audit results ofthe consolidated financial statements by the Accounting Auditors and the Audit &Supervisory Board for the 97th fiscal year (from April 1, 2023 to March 31, 2024)
2.

Report on the non-consolidated financial statements for the 97th fiscal year (from April 1,
2023 to March 31, 2024)

Matters for Resolution<Company Proposals>
First Item of Business:
Appropriation of Surplus
Second Item of Business: Reduction in the Amount of Legal Capital Surplus
Third Item of Business:
Partial Amendments to the Articles of Incorporation
Fourth Item of Business: Election of Ten (10) Directors
Fifth Item of Business:
Election of Five (5) Audit & Supervisory Board Members<Shareholder Proposal>
Sixth Item of Business:
Appropriation of Surplus
The outline of the Shareholder Proposal (Sixth Item of Business) is as described in the
Reference Materials for the General Meeting of Shareholders.
4. Matters Determined for the Convocation of the Meeting(1) If you exercise your voting rights in writing (by mail) and do not indicate your approval ordisapproval of the proposals on the voting form, it will be treated as an indication of approval
for the Company proposals and disapproval for the shareholder proposal.
(2) If you exercise your voting rights more than once via the Internet, the last vote will be treatedas the valid vote.
(3) If you exercise your voting rights both via the Internet and in writing (by mail), the vote
exercised via the Internet will be treated as valid, regardless of the arrival date and time.
(4) If you wish to exercise your voting rights by proxy, you may delegate your voting rights toone other shareholder who has voting rights in accordance with the provisions of the Articles
of Incorporation of the Company. However, a written document evidencing the proxy’s
power of representation must be submitted in advance.
- End --------------------------------------------------------------------------------------------------------------------------[English Translation]

2

●
●
●

If you plan to attend the meeting, please submit the Voting Rights Exercise Form to the reception desk on
the day.
In the event of any amendments to the matters to be provided in electronic format, a notice of such
amendments will be posted on the Company’s website and on the website for posting materials for the
General Meeting of Shareholders, as well as items before and after such amendments.
The following items are not included in the written documents provided to shareholders who haverequested the delivery of such documents, pursuant to the provisions of laws and regulations and Article
16 of the Articles of Incorporation of the Company.
Business Report
The Current Position of TBS Holdings, Inc. and its Subsidiaries
Business Activities and Results
Priorities
Assets and Profit/Loss
Main Business Activities
Principal Sales OfficeWork Force
Main Lenders
Common Stock
Accounting Auditors
System for Ensuring the Appropriateness of Business Operations
Basic Policy Regarding Parties Deciding on Financial andBusiness Policies of TBS Holdings, Inc.

Consolidated Financial Statements
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Changes in Equity
Notes to Consolidated Financial Statements
Financial Statements
Non-Consolidated Balance Sheets
Non-Consolidated Statements of Income
Non-Consolidated Statements of Changes in Equity
Notes to Non-Consolidated Financial Statements
Audit Reports
Independent Auditors’ Report (Consolidated Statutory Report)
Independent Auditors’ Report (Statutory Report)
Audit & Supervisory Board’s Report

These items are included in the Business Report, Consolidated Financial Statements, and Non-Consolidated
Financial Statements audited by the Accounting Auditor or Audit & Supervisory Board members when preparing
the Audit Reports or the Independent Auditors’ Report.

[English Translation]3

Electronic Voting Platform
Regarding the exercise of voting rights via electronic means at the Company’s General Meeting of
Shareholders, nominee shareholders such as trust and custody banks (including standing proxies) may,as an alternative to the voting via the Internet described above, use the Electronic Voting Platformorganized by the Investor Communications Japan (ICJ) Inc., a joint venture company established by
the Tokyo Stock Exchange, etc., provided that application for the use of the Electronic Voting Platform
is made in advance.

Inquiries on exercising voting rights via the Internet
Stock Transfer Agency (Help Desk), Mitsubishi UFJ Trust and Banking Corporation
0120-173-027 (toll free, only in Japan, from 9:00 A.M. to 9:00 P.M.)
To Institutional Investors:
Institutional investors may also exercise voting rights at this General Meeting electronically using
the “Electronic Voting Rights Platform” operated by ICJ, Inc.

[English Translation]

4

Reference Materials for the General Meeting of Shareholders
Company Proposals (First Item of Business through Fifth Item of Business)
First Item of Business:
Appropriation of Surplus
Since returning the Company’s profits to the shareholders is one of the significant managerial
issues, the Company takes basic policies to implement annual dividends on a stable and continual basis,
with a target of a dividend payout ratio of 30% of the consolidated profit attributable to owners ofparent for the fiscal year under review. The Company has decided that dividend per share during theperiod of this Medium-term Management Plan (FY2021 to FY2023) shall not fall below ¥30. With
respect to the year-end dividend for FY2023, taking elements of revenues for the fiscal year underreview and the financial conditions, among other things into consideration comprehensively, it is
proposed as follows:
Matters related to year-end dividend:(1)Type of dividend property: Cash
(2)
Matters related to distribution of cash and total amount:¥22 per share of common stock of the Company
The total dividend amount: ¥3,633,665,530
Including the interim dividend of ¥22, the annual dividend will be ¥44 per share.
(3)
Effective date for dividends from surplus to shareholders:June 28, 2024

[English Translation]

5

Second Item of Business:
1.

Reduction in the Amount of Legal Capital Surplus

Reason for reduction in the amount of legal capital surplus

In order to prepare for future flexible capital policies and to ensure the agility and flexibility offinancial strategies to promote the Planning of Akasaka Entertainment City Initiative and other growthstrategies to achieve the “TBS Group Medium-term Management Plan 2026” and “TBS GroupVISION 2030” beyond the plan, it is proposed to reduce the amount of legal capital surplus andtransfer it to other capital surplus in accordance with the provisions of Article 448, Paragraph 1 of theCompanies Act.
2.

Details of reduction in the amount of legal capital surplus(1) Amount of legal capital surplus to be reduced
Out of ¥35,026,114,648 in legal capital surplus, ¥25,000,000,000 will be reduced and theentire amount of reduction will be transferred to other capital surplus, bringing the amount oflegal capital surplus after the reduction to ¥10,026,114,648.
(2) Schedule for reduction in the amount of legal capital surplus
Date of resolution by Board of Directors: May 14, 2024
Date of resolution by General Meeting of Shareholders: June 27, 2024 (plan)
Date of public notice of creditors’ objection: July 23, 2024 (plan)
Final date for creditors’ objection: August 23, 2024 (plan)
Effective date: August 30, 2024 (plan)[English Translation]

6

Third Item of Business:
1.

Partial Amendments to the Articles of Incorporation

Reasons for the proposal(1) Toward the realization of “TBS Group VISION2030,” the Company is promoting innovationin content creativity and “EDGE,” an expansion strategy for unlimited expansion of the content
we have created. As part of the initiatives, the Company made YARUKI Switch Group
Holdings Co., Ltd. a consolidated subsidiary on June 29, 2023 for the purpose of making a fulladvance into the intellectual training and education business, and also announced its full-scale
entry into the gaming industry, through Tokyo Broadcasting System Television, Inc., in July
2023. As a result of this, the purpose of business stipulated in Article 2 of the Articles ofIncorporation shall be partially amended.
(2) In order to maintain an appropriate number of Directors, the number of Directors stipulated in
Article 21 of the Articles of Incorporation shall be reduced from “no more than twenty (20)”
to “no more than fourteen (14).”2.

Details of the amendments are as follows.
(The underlined portions indicate the changes.)
Proposed amendments

Current Articles of Incorporation(Purpose)
Article 2.
1. The purpose of the Company shall be, by holding
shares or equity in companies that carry out thefollowing businesses (including foreign companies),
associations (including those equivalent toassociations in foreign countries), and other similarbusiness entities, to control and manage the businessactivities thereof, as well as to support the businessactivities of such companies, etc.
1. through 12. (Omitted)
13. Development and sales of computer-related
software
14. through 35. (Omitted)
36. Management of the education business related tobroadcasting and communication, language andbeauty, etc.
37. All operations incidental or related to any of thepreceding items
2. The Company may engage in businesses listed ineach item of the preceding paragraph or all
businesses incidental or related thereto.
(Number and Election of Directors)
Article 21.
1. Directors of the Company shall not exceed twenty(20), and shall be elected by a resolution of a General
Meeting of Shareholders.
2. A resolution for the election of Directors shall be
adopted by a majority vote of the shareholders inattendance who hold one-third or more of the voting
rights of shareholders who are entitled to exercise
voting rights.
3. Cumulative voting shall not be used for the
resolution to elect Directors.

[English Translation]

7(Purpose)
Article 2.
1. The purpose of the Company shall be, by holding
shares or equity in companies that carry out thefollowing businesses (including foreign companies),
associations (including those equivalent toassociations in foreign countries), and other similarbusiness entities, to control and manage the businessactivities thereof, as well as to support the businessactivities of such companies, etc.
1. through 12. (Unchanged)
13. Planning, development and sales of computerrelated software
14. through 35. (Unchanged)
36. Education business
37. All operations incidental or related to any of thepreceding items
2. The Company may engage in businesses listed ineach item of the preceding paragraph or all
businesses incidental or related thereto.
(Number and Election of Directors)
Article 21.
1. Directors of the Company shall not exceed fourteen(14), and shall be elected by a resolution of a General
Meeting of Shareholders.
2. A resolution for the election of Directors shall be
adopted by a majority vote of the shareholders inattendance who hold one-third or more of the voting
rights of shareholders who are entitled to exercise
voting rights.
3. Cumulative voting shall not be used for the
resolution to elect Directors.

Fourth Item of Business:
Election of Ten (10) Directors
The terms of all ten (10) Directors of the Company will expire at the conclusion of this Ordinary
General Meeting of Shareholders.
Accordingly, the Company would like to ask shareholders to elect ten (10) Directors at thisOrdinary General Meeting of Shareholders. If this item is approved as originally proposed, theCompany will continue to be a structure where Outside Directors make up at least 1/3 of the Board of
Directors, and where one (1) of the Directors is female. The candidates for Directors are as follows:
CandidatenumberPosition in the Company
after election

Name

Attendance tomeetings ofBoard ofDirectors

Nomination Remuneration
Advisory
Advisory
Committee
Committee

1Re-election

Takashi Sasaki

Male

Chairman and Director

2

Newlyappointed

Ryujiro Abe

MalePresident and Chief
Executive Officer

●*

●*

3

Newlyappointed

Masamine Ryuho

Male

Vice President andRepresentative Director

●*

●*

4

Re-election

Tatsuo Sugai

Male

Executive Vice President
and Board Director

5

Newlyappointed

Yasushi Gemba

Male

Managing Director

●*

●*

6

Newlyappointed

Shigetoshi Ida

MaleManaging Director

7

Re-election
OutsideIndependent

Hitoshi Kashiwaki

Male

Outside Director

100%

◎

◎

Re-election
OutsideIndependent

Yosuke Yagi

100%

●

●

9

Re-election
OutsideIndependent

Makoto Haruta

Male

Outside Director

100%

●

●

10

Re-election
OutsideIndependent

Natsuko Takei

FemaleOutside Director

100%

●

●

8

Male

Outside Director

100%

85%

◎ Refers to chair of Advisory Committee.
* If Mr. Ryujiro Abe, Mr. Masamine Ryuho, and Mr. Yasushi Gemba are elected as Directors, they will become members of the Nomination
Advisory Committee and the Remuneration Advisory Committee.

[English Translation]

8

Board of Directors Skills Matrix
The skillsets necessary for the Company’s Board of Directors and the skills of each Director
candidate are as follows.
The Company has formulated “TBS Group VISION 2030” and is accelerating its transformationfrom a media group to a content group.
These are the skill categories needed to achieve that vision, such as improving the value of
broadcasting, executing the growth strategy “EDGE,” addressing materialities (priority issues), andenhancing corporate value through sustainability management, as described in the plan.
Human
Resource
Management

Growth Strategy “EDGE”

Name

Finance &Accounting

Takashi Sasaki●●

Ryujiro Abe●

Masamine
Ryuho

●

●

●

Tatsuo Sugai

●

●

●

Yasushi Gemba

Sustainability

Legal &
Compliance

Competitive
Strategy

Company
Management●

Yosuke Yagi●

Makoto Haruta●

Natsuko Takei[English Translation]

Experience
Domain

●

●

●

●

●

GlobalDomain●●HitoshiKashiwaki

Digital
Domain●●Shigetoshi Ida

MediaContent

●

●

●

●

●

●

●

●

●

●

●

●

●

●

9

●

●

●

Number of shares of the Company
owned:

Candidatenumber1

67,607 shares

Takashi Sasaki

Date of birthJul. 5, 1959

Summary of career and position and areas of responsibility
Apr. 1982:
Joined the Company
Jun. 2009:
Division President of Finance Division of Tokyo
Broadcasting System Television, Inc.
Nov. 2010:
Division President of Group Managerial Planning
Division of the Company
Division President of Office of Corporate Planningof Tokyo Broadcasting System Television, Inc.

Re-election

Mar. 2015:
Jun. 2015:
Apr. 2016:
Jun. 2017:

Attendance to meetings of Board of
Directors:

13/13 (100%)

Director of Tokyo Broadcasting System Television,
Inc.
Director of the Company
Managing Director of the Company
Managing Director of Tokyo Broadcasting System
Television, Inc.
Senior Managing Director of the Company
Senior Managing Director of Tokyo Broadcasting
System Television, Inc.

Division President of Programming Division ofTokyo Broadcasting System Television, Inc.
Executive Officer, Division
President of Jun. 2018:
President and Chief Executive Officer of theApr. 2013:
Programming Division of Tokyo Broadcasting
Company (incumbent)
System Television, Inc.
President and Representative Director of Tokyo
Broadcasting System Television, Inc. (incumbent)
Feb. 2014:
Executive Officer of the Company
Executive Officer of Tokyo Broadcasting System
Areas of responsibility: Office of Internal Audit
Television, Inc.
Important concurrent position outside the Company
President and Representative Director of Tokyo Broadcasting
System Television, Inc.
Outside Director of The Mainichi Newspapers Group Holdings Co.,Ltd.
Reason for nomination as candidate for Director
Mr. Takashi Sasaki currently supervises the policy for enhancing the corporate value of the Group as President and Chief Executive Officerof the Company and Tokyo Broadcasting System Television, Inc. He has extensive experience and achievements in corporate management,
as well as a deep understanding and knowledge of the business environment.
Apr. 2012:

Candidatenumber2

Ryujiro Abe

Date of birth

May 11, 1964

Summary of career and position and areas of responsibility
Apr. 1988:
Joined the Company
Apr. 2016:

Jun. 2017:
Jun. 2018:

Jan. 2019:

Division President of Group Managerial Planning
Division of the Company
Division President of Office of Corporate Planningof Tokyo Broadcasting System Television, Inc.
President and Representative Director of TBSVISION, Inc.
Executive Officer of the Company

Jun. 2020:

Jun. 2022:

Newly-appointed

Number of shares of the Company
owned:

17,320 shares

President and Representative Director of TBS
Sparkle, Inc.
Director of Tokyo Broadcasting System Television,
Inc.

Executive Officer in charge of Growth Strategy of theCompany (incumbent)

Reason for nomination as candidate for Director
Mr. Ryujiro Abe contributes to enhancing the corporate value of the Group as Executive Officer in charge of growth strategy and General
Manager of EDGE Strategy HQ. He has extensive experience and achievements in corporate management, as well as a deep understanding
and knowledge of the business environment.

[English Translation]

10

Candidate
number3

Masamine Ryuho November 1, 1964
Date of birthSummary of career and position and areas of responsibility
Apr. 1987:
Joined the Company

Jun. 2020:

Newly-appointed

Number of shares of the Company
owned:

20,756 shares

Project Executive Officer of the Company
President and Representative Director of TVer INC.
Director of Tokyo Broadcasting System Television,
Inc. (incumbent)

Division President of Office of Media strategy of the Jun. 2022:
Company
Division President of Office of Media strategy ofTokyo Broadcasting System Television, Inc.
Jun. 2018:
Director of the Company
Director of Tokyo Broadcasting System Television,
Inc.
Reason for nomination as candidate for Director
Mr. Masamine Ryuho contributes to enhancing the corporate value of the Group in the posts of overseeing and promoting DX and distribution
strategies, etc., as General Manager of Content Strategy HQ of Tokyo Broadcasting System Television, Inc., a core subsidiary. He has
extensive experience and achievements in corporate management, as well as a deep understanding and knowledge of the businessenvironment.
Apr. 2016:

Number of shares of the Company
owned:

Candidatenumber4

42,729 shares

Tatsuo Sugai

Date of birthSep. 28, 1959

Summary of career and position and areas of responsibility
Apr. 1983:
Joined the Company
May 2010:
Division President of Sales Division of Tokyo
Broadcasting System Television, Inc.

Mar. 2014:

Re-election

Attendance to meetings of Board of
Directors:

11/13 (85%)

Director of Tokyo Broadcasting System Television,
Inc.
Director of the Company
Managing Director of the Company
Managing Director of Tokyo Broadcasting System
Television, Inc.
Director, Head of Growth Strategy of the Company(incumbent)
Senior Managing Director of Tokyo Broadcasting
System Television, Inc. (incumbent)

Jun. 2015:
Division President of Group Managerial Planning Jun. 2018:
Division of the Company
Apr. 2013:
Executive Officer, Division President of GroupManagerial Planning Division of the Company
Jun. 2020:
Executive Officer, Division President of Office ofCorporate Planning of Tokyo Broadcasting System
Television, Inc.
Feb. 2014:
Executive Officer of the Company
Important concurrent position outside the Company
Senior Managing Director of Tokyo Broadcasting System
Director of U-NEXT Co., Ltd.
Television, Inc.
CEO of THE SEVEN, INC.
Reason for nomination as candidate for Director
Mr. Tatsuo Sugai contributes to enhancing the corporate value of the Group in the post of Director as the head of the growth strategy division.
He has experience and achievements in corporate management, as well as a deep understanding and knowledge of the business environment.
Apr. 2012:[English Translation]

11

Candidate
number5

Yasushi Gemba

Date of birthJul. 14, 1965

Summary of career and position and areas of responsibility
Apr. 1989:
Joined the Company

Jun. 2020:

Newly-appointed

Number of shares of the Company
owned:

17,838 shares

Executive Officer in charge of Growth Strategy of theCompany
Executive Officer in charge of Financial Strategy(incumbent)
Director of Tokyo Broadcasting System Television,
Inc. (incumbent)

Division President of Group Design Division of the Jun. 2021:
Company
Division President of Group Design Division ofJul. 2019:
Tokyo Broadcasting System Television, Inc.
Reason for nomination as candidate for Director
Mr. Yasushi Gemba contributes to enhancing the corporate value of the Group as Executive Officer in charge of financial strategy andGeneral Manager of Financial Strategy HQ. He has experience and achievements in corporate management, as well as a deep understanding
and knowledge of the business environment.
Jul. 2018:

Candidatenumber6

Shigetoshi Ida

Date of birthNov. 30, 1965

Summary of career and position and areas of responsibility
Apr. 1991:
Joined the Company

Jun. 2022:

Newly-appointed

Number of shares of the Company
owned:

8,064 shares

Director of Tokyo Broadcasting System Television,
Inc. (incumbent)
Executive Officer in charge of ESG Strategy of theCompany (incumbent)

Division President of Division of Human Resources Jun. 2022:
and Labor of the Company
Division President of Division of Human Resourcesand Labor of Tokyo Broadcasting System Television,
Inc.
Reason for nomination as candidate for Director
Mr. Shigetoshi Ida contributes to enhancing the corporate value of the Group as Executive Officer in charge of ESG strategy. He has
experience and achievements in corporate management, as well as a deep understanding and knowledge of the business environment.
Jul. 2020:[English Translation]

12

Number of shares of the Company
owned:

Candidatenumber7

Hitoshi Kashiwaki Sep. 6, 1957
Date of birthSummary of career and position and areas of responsibility
President and Representative Director of Recruit Co.,
Jun. 2003:
Ltd. (current Recruit Holdings Co., Ltd.)
Apr. 2012:
Dec. 2012:

Director and Senior Advisor of Recruit Holdings Co.,Ltd.
Outside Director of Suntory Beverage & Food
LimitedMar. 2016:
May 2016:
Jun. 2018:

Re-election
OutsideIndependent

0 shares

Attendance to meetings of Board of
Directors:

13/13 (100%)

Outside Director of ASICS Corporation
Outside Director of Matsuya Co., Ltd. (incumbent)
Outside Director of the Company (incumbent)
Director of Tokyo Broadcasting System Television,
Inc.
Outside Director of Kewpie Corporation (incumbent)

Feb. 2021:
Important concurrent position outside the Company
Outside Director of Matsuya Co., Ltd.
Outside Director of Kewpie Corporation
Reason for nomination as candidate for Outside Director and outline of expected role
Mr. Hitoshi Kashiwaki has considerable experience and a high degree of knowledge as a member of top management of an operatingcompany. As he is expected to continuously offer useful opinions and suggestions to the management as well as supervision over and advice
regarding duties executed by Directors toward the execution of the growth strategy “EDGE” set forth in “TBS Group VISION 2030” andcontinuous enhancement of the corporate value of the Group, he is nominated as candidate for Outside Director of the Company.
Number of shares of the Company
owned:

Candidatenumber8

Yosuke Yagi

Re-election
Date of birthAug. 12, 1955

Summary of career and position and areas of responsibility
Joined Nippon Kokan K.K. (current JFE SteelApr. 1980:
Corporation)
General Manager of Human Resource Department ofJan. 1999:
GE Yokogawa Medical Systems Ltd. (current GE
Healthcare Japan Corporation)
Director and General Manager of Human Resource
Jun. 1999:
Department of GE Healthcare Japan Corporation
Director of GE Japan Inc.
Dec. 2002:
Executive Officer and Executive Vice President of JS
Apr. 2012:
Group Corporation (current LIXIL Corporation)
Important concurrent position outside the Company
Representative Director of People First, Ltd.
Board Member of ICMG Co., Ltd.

Jan. 2017:

Jun. 2017:
Jun. 2020:
Apr. 2021:

OutsideIndependent

0 shares

Attendance to meetings of Board of
Directors:

13/13 (100%)

Representative Director of People First, Ltd.
(incumbent)
Board Member of ICMG Co., Ltd. (incumbent)
Chairman and Representative Director of IWNC Inc.,
Ltd.
Chairman and Director of IWNC Inc., Ltd.
(incumbent)
Outside Director of the Company (incumbent)
Audit & Supervisory Board Member of GE
Healthcare Japan Corporation (incumbent)

Chairman and Director of IWNC Inc., Ltd.
Audit & Supervisory Board Member of GE Healthcare Japan
Corporation
Reason for nomination as candidate for Outside Director and outline of expected role
Mr. Yosuke Yagi has considerable experience and a high degree of knowledge as the head of human resources strategy and a member of top
management of an operating company. As he is expected to continuously offer useful opinions and suggestions to the management as wellas supervision over and advice regarding duties executed by Directors toward the execution of the growth strategy “EDGE” set forth in “TBSGroup VISION 2030” and continuous enhancement of the corporate value of the Group, he is nominated as candidate for Outside Directorof the Company.

[English Translation]

13

Number of shares of the Company
owned:

Candidatenumber9

Makoto Haruta

Re-election
OutsideDate of birthJan. 5, 1969

Summary of career and position and areas of responsibility
Joined Sumitomo Bank Co., Ltd. (current Sumitomo
Apr. 1992:
Mitsui Banking Corporation)
Joined DeNA Co., Ltd.
Feb. 2000:
Director and Head of Corporate Planning Division of
Sep. 2000:
DeNA Co., Ltd.

Independent

0 shares

Attendance to meetings of Board of
Directors:

13/13 (100%)

Mar. 2017:
Oct. 2017:

Adviser of Money Forward, Inc. (incumbent)
Representative Director & Chairman of ExaWizards
Inc.

Nov. 2018:
Jun. 2020:
Apr. 2022:

Director & Chairman of ExaWizards Inc.
Outside Director of the Company (incumbent)
Director of Panasonic Corporation (incumbent)

Director, Executive Chairman and Executive Officer
of DeNA Co., Ltd.
Representative Director and CEO of betaCatalyst Apr. 2023:
Representative Director & President of ExaWizards
Apr. 2015:
Inc. (incumbent)
Inc. (incumbent)
Important concurrent position outside the Company
Representative Director and CEO of betaCatalyst Inc.
Adviser of Money Forward, Inc.
Representative Director & President of ExaWizards Inc.
Director of Panasonic Corporation
Reason for nomination as candidate for Outside Director and outline of expected role
Mr. Makoto Haruta has considerable experience and a high degree of knowledge as the head of financial strategy and a member of top
management of an operating company. As he is expected to continuously offer useful opinions and suggestions to the management as wellas supervision over and advice regarding duties executed by Directors toward the execution of the growth strategy “EDGE” set forth in “TBSGroup VISION 2030” and continuous enhancement of the corporate value of the Group, he is nominated as candidate for Outside Directorof the Company.
Jun. 2011:

Number of shares of the Company
owned:

Candidatenumber10

Natsuko Takei

Re-election
Date of birthFeb. 10, 1961

Summary of career and position and areas of responsibility
Apr. 1983:
Joined Sony Corporation(current Sony Group Corporation)
Senior Vice President, Corporate Executive of Sony
Jun. 2013:
Group Corporation

OutsideIndependent

0 shares

Attendance to meetings of Board of
Directors:

10/10 (100%)

Jun. 2021:

Executive Vice President of Sony Group Corporation

Jun. 2023:

Officer in charge of Legal, Compliance, and Privacy
Senior General Manager, Legal Department
Outside Director of the Company (incumbent)
External Member of the Board of Tokyo Metro Co.,
Ltd. (incumbent)

Important concurrent position outside the Company
Director of Sony Institute of Higher Education
External Member of the Board of Tokyo Metro Co., Ltd.
Reason for nomination as candidate for Outside Director and outline of expected role
Ms. Natsuko Takei has considerable experience and a high degree of knowledge as the head of legal affairs and compliance at an operatingcompany. As she is expected to continuously offer useful opinions and suggestions to the management as well as supervision over and advice
regarding duties executed by Directors toward the execution of the growth strategy “EDGE” set forth in “TBS Group VISION 2030,”
especially in promoting activities in the global domain, and continuous enhancement of the corporate value of the Group, she is nominatedas candidate for Outside Director of the Company.

Note 1:
Note 2:
Note 3:

Each of candidates has no special interest in the Company.
Mr. Hitoshi Kashiwaki, Mr. Yosuke Yagi, Mr. Makoto Haruta, and Ms. Natsuko Takei are candidates
for Outside Directors.
The following are matters regarding candidates for Outside Directors:(1) Independent Directors
The Company has registered Mr. Hitoshi Kashiwaki, Mr. Yosuke Yagi, Mr. Makoto Haruta and
Ms. Natsuko Takei as independent directors with the Tokyo Stock Exchange and will continue toappoint them as independent directors if they are reappointed.
(2) Number of years since assuming the office of Outside Director (until the conclusion of this General
Meeting of Shareholders):
Hitoshi Kashiwaki: 6 years
Yosuke Yagi:
4 years[English Translation]

14

Makoto Haruta:
4 years
Natsuko Takei:
1 year(3) Ms. Natsuko Takei is expected to be appointed as a Member of the Board of NIPPONTELEGRAPH AND TELEPHONE CORPORATION at their 39th general meeting ofshareholders to be held on June 20, 2024.
Note 4:Note 5:

Liability Limitation Agreement:
The Company has entered into an agreement with Mr. Hitoshi Kashiwaki, Mr. Yosuke Yagi, Mr.
Makoto Haruta and Ms. Natsuko Takei that limits their liabilities as defined in the provision of Article
423, Paragraph 1 of the Companies Act. The Company will extend such agreement with them provided
they are reappointed.
Directors and Officers Liability Insurance Policy:
The Company has entered into a directors and officers liability insurance policy between an insurancecompany in accordance with Article 430-3, Paragraph 1 of the Companies Act. A summary of thecontents of the said insurance policy is as stated in “Summary of Contents of a Directors and Officers
Liability Insurance Policy, etc.” of the Business Report. If the nomination of each candidate for Director
is approved, they will continue to be included as the insureds under the said insurance. The insurance
policy will be renewed with the contents unchanged on its next renewal.

[English Translation]

15

Fifth Item of Business:
Election of Five (5) Audit & Supervisory Board Members
The terms of all five (5) Audit & Supervisory Board Members of the Company will expire at theconclusion of this Ordinary General Meeting of Shareholders. Accordingly, the Company would likeshareholders to elect five (5) Audit & Supervisory Board Members at this Ordinary General Meetingof Shareholders.
With respect to this item, the Company has obtained consent from the Audit & Supervisory Board.
The candidates for Audit & Supervisory Board Members are as follows:
CandidatenumberAttendance toAttendance tomeetings of Audit
Position in the Company
meetings of Board& Supervisory
after electionof Directors
Board

Name

1

Newlyappointed

Tetsu Fujiwara

MaleStanding Statutory Audit& Supervisory Board
Member2

Newlyappointed

Naoya Tsukui

MaleStanding Statutory Audit& Supervisory Board
Member3

Re-election
OutsideIndependent

Mie Fujimoto

FemaleOutside Audit &Supervisory Board
Member4

Newlyappointed
OutsideIndependent

Masahiko Oshima

Male

Outside Audit &Supervisory Board
Member5

Newlyappointed
OutsideIndependent

Junko Kogayu

FemaleOutside Audit &Supervisory Board
Member[English Translation]

16

92%

93%

Candidate
number1

Tetsu Fujiwara

Date of birthFeb. 12, 1962

Newly-appointed

Number of shares of the Company
owned:

266 shares

Summary of career and position
Division President of Office of Internal Business
Apr. 1985:
Joined the Company
Jul. 2020:
Audit (current Office of Internal Audit) of theDivision President of Compliance Division (current
Jul. 2018:
Company (incumbent)
Legal & Compliance Division) of the Company
Division President of Office of Internal Business
Division President of Compliance Division (current
Audit (current Office of Internal Audit) of Tokyo
Legal & Compliance Division) of Tokyo
Broadcasting System Television, Inc. (incumbent)
Broadcasting System Television, Inc.
Reason for nomination as candidate for Audit & Supervisory Board Member
Mr. Tetsu Fujiwara has considerable knowledge of internal controls and audits through his experience as Division President of Legal &Compliance Division and Division President of Office of Internal Audit. Therefore, the Company has judged that he is an appropriate
candidate for an Audit & Supervisory Board Member of the Company.
Candidatenumber2

Naoya Tsukui

Date of birthNov. 28, 1964

Summary of career and position
Apr. 1987:
Joined the Company

Jun. 2020:

Newly-appointed

Number of shares of the Company
owned:

6,133 shares

Director of TBS Art & Technology Inc. (current TBS
ACT, INC.) (incumbent)

Division President of Administration Division of theCompany
Division President of Administration Division ofTokyo Broadcasting System Television, Inc.
Reason for nomination as candidate for Audit & Supervisory Board Member
Mr. Naoya Tsukui has considerable knowledge of finance and accounting through his experience as Head of Accounting Division andDivision President of Administration Division. Therefore, the Company has judged that he is an appropriate candidate for an Audit &Supervisory Board Member of the Company.
Jul. 2018:[English Translation]

17

Number of shares of the Company
owned:

0 shares

Candidatenumber3

Re-election

Mie Fujimoto

OutsideDate of birthAug. 17, 1967

Independent

Attendance to meetings of Board of
Directors:

12/13 (92%)

Attendance to meetings of Audit &Supervisory Board:

13/14 (93%)

Summary of career and position
Outside Audit & Supervisory Board Member of theApr. 1993:
Registered as lawyer
Jun. 2016:
Company (incumbent)
Joined SHIN-TOKYO SOHGOH LAW OFFICE
Outside Member of Audit & Supervisory Board of Jun. 2016:
Audit & Supervisory Board Member of Tokyo
Jun. 2009:
Kuraray Co., Ltd.
Broadcasting System Television, Inc. (incumbent)
Apr. 2015:
Joined TMI Associates (incumbent)
Mar. 2019:
Outside Director of Kuraray Co., Ltd.
Outside Audit & Supervisory Board Member of Mar. 2020:
Independent Director of EBARA CORPORATION
Jun. 2015:
SEIKAGAKU CORPORATION(incumbent)
Important concurrent position outside the Company
Audit & Supervisory Board Member of Tokyo Broadcasting System Partner of TMI Associates (lawyer)
Television, Inc.
Independent Director of EBARA CORPORATION
Reason for nomination as candidate for Outside Audit & Supervisory Board Member
Ms. Mie Fujimoto has extensive experience and high degree of knowledge as a lawyer specialized in corporate legal affairs. Although Ms.
Fujimoto has not been involved in corporate management by other means than serving as an outside officer, for the above reason, she isexpected to provide beneficial opinions, findings, and the like to the management of the Group from objective viewpoints. Accordingly, theCompany has judged that she can appropriately perform the duties as an Outside Audit & Supervisory Board Member of the Company.

Candidatenumber4

Masahiko Oshima Sep. 13, 1960
Date of birthSummary of career and position
Director and Deputy President of Sumitomo Mitsui
Apr. 2019:
Banking Corporation
Deputy President and Executive Officer of Sumitomo
Mitsui Financial Group, Inc.

Apr. 2023:
Jun. 2023:
Apr. 2024:

Newly-appointed
OutsideNumber of shares of the Company
owned:

0 shares

Deputy Chairman of Sumitomo Mitsui Banking
Corporation
Outside Director of Toyota Motor Corporation(incumbent)
Advisor of Sumitomo Mitsui Banking Corporation(incumbent)

Important concurrent position outside the Company
Outside Director of Toyota Motor Corporation
Advisor of Sumitomo Mitsui Banking Corporation
Reason for nomination as candidate for Outside Audit & Supervisory Board Member
Mr. Masahiko Oshima has extensive experience and high degree of knowledge as a member of the top management of a financial institution,and has considerable knowledge of finance and accounting. He is expected to provide beneficial opinions, findings, and the like to the
management of the Group from objective viewpoints. Accordingly, the Company has judged that he is an appropriate candidate for an
Outside Audit & Supervisory Board Member of the Company.

[English Translation]18

Candidate
number5

Newly-appointed

Junko Kogayu

OutsideDate of birthOct. 10, 1967

Summary of career and position
Apr. 1991:
Joined Chuo Shinko Audit Corporation

Apr. 2020:

Mar. 1994:

Dec. 2020:

Registered as a certified public accountant

Independent

Number of shares of the Company
owned:

0 shares

Joined Ayako Takeuchi Tax Accountant Office(incumbent)
Outside Director of NITCHO CORPORATION(incumbent)
Outside Director of NISSIN CORPORATION(incumbent)
Outside Director of CERES INC.

Joined PricewaterhouseCoopers Aarata (current Jun. 2021:
PricewaterhouseCoopers Japan LLC)
Established Junko Kogayu Certified Public Mar. 2022:
Jan. 2020:
Accountant Office (incumbent)
Mar. 2020:
Registered as a tax accountant
Important concurrent position outside the Company
Certified Public Accountant of Junko Kogayu Certified Public Accountant Office
Tax Accountant of Ayako Takeuchi Tax Accountant OfficeOutside Director of NITCHO CORPORATION
Outside Director of NISSIN CORPORATION
Reason for nomination as candidate for Outside Audit & Supervisory Board Member
Ms. Junko Kogayu has extensive experience and high degree of knowledge as a certified public accountant and tax accountant, and has
considerable knowledge of finance and accounting. Although Ms. Kogayu has not been involved in corporate management by other means
than serving as an outside officer, for the above reason, she is expected to provide beneficial opinions, findings, and the like to the
management of the Group from objective viewpoints. Accordingly, the Company has judged that she can appropriately perform the duties
as an Outside Audit & Supervisory Board Member of the Company.
Sep. 2006:

Note 1:
Note 2:Each of candidates has no special interest in the Company.
Ms. Mie Fujimoto, Mr. Masahiko Oshima, and Ms. Junko Kogayu are candidates for Outside Audit &Supervisory Board Members.
Note 3:
The following are special notes regarding candidates for Outside Audit & Supervisory Board Members:(1) Independent Audit & Supervisory Board Members
The Company has registered Ms. Mie Fujimoto as an independent audit & supervisory board
member with the Tokyo Stock Exchange and will continue to appoint her as an independent audit& supervisory board member if she is reappointed. In addition, Ms. Junko Kogayu meets therequirements for independent audit & supervisory board members as stipulated by the Tokyo
Stock Exchange, and she is expected to be appointed as an independent audit & supervisory board
member.
(2) Number of years since assuming the office of Audit & Supervisory Board Member (until theconclusion of this General Meeting of Shareholders):
Mie Fujimoto:8 years(3) In November 2019 when Ms. Mie Fujimoto was serving as Outside Director of Kuraray Co., Ltd.,
Kuraray Co., Ltd. received a cease-and-desist order from the Japan Fair Trade Commission forviolations of the Antimonopoly Act in the manufacture and sale of specific activated carbon usedin water purification and other facilities. Although Ms. Fujimoto had not been aware of such
violations until they were found, she had been bringing people’s attention to the importance ofcomplying with laws and regulations on a regular basis at the Board of Directors and othermeetings. After being aware of the fact of such violations, she checked the details of the initiatives
at the Board of Directors and other meetings, and made suggestions to prevent the recurrence ofsuch violations, thereby fulfilling her responsibility.
(4) Ms. Mie Fujimoto is scheduled to be appointed an External Member of the Board of Elematec
Corporation at the 78th Ordinary General Meeting of Shareholders of Elematec Corporation to beheld on June 26, 2024.
(5) While Mr. Masahiko Oshima was serving as Executive Officer of Sumitomo Mitsui Financial
Group, Inc. (SMFG) and Director of Sumitomo Mitsui Banking Corporation, SMFG and SMBC
Nikko Securities Inc., a subsidiary of SMFG, were issued administrative actions by the Financial
Services Agency pursuant to the Financial Instruments and Exchange Act in October 2022, inconnection with violation of Article 159, Paragraph 3 of the Financial Instruments and Exchange
Act (illegal stabilization transactions) by several former executive officers and employees of
SMBC Nikko Securities Inc. In addition, SMBC Nikko Securities Inc. was convicted by the Tokyo
District Court in February 2023 in connection with the said violation, and the decision became
19[English Translation]

Note 4:Note 5:

final. Furthermore, in October 2022, SMBC Nikko Securities Inc. was issued administrative
actions by the Financial Services Agency pursuant to the Financial Instruments and Exchange Act,in connection with the receipt of undisclosed information among executive officers and employeesof SMBC Nikko Securities Inc. and Sumitomo Mitsui Banking Corporation. In addition, SMFG
and Sumitomo Mitsui Banking Corporation received an Order for Submission of Report from the
Financial Services Agency in accordance with the Financial Instruments and Exchange Act andthe Banking Act in connection with the said situation. Although Mr. Masahiko Oshima had notbeen aware of such situations, he had constantly mentioned the importance of complying withlaws and regulations and ensuring appropriate operations and risk management at the Board of
Directors and other meetings, while giving suggestions to thoroughly ensure the implementation
thereof. Even after such situations were found, he promoted initiatives to effectively formulate
and carry out measures to prevent recurrence, further strengthen the compliance system andinternal control systems of SMBC Group as well as foster a sound corporate culture, mainly
through deliberations at the Board of Directors and other meetings.
Liability Limitation Agreement:
The Company has entered into an agreement with Ms. Mie Fujimoto that limits her liabilities as definedin the provision of Article 423, Paragraph 1 of the Companies Act. The Company will extend suchagreement with her provided she is reappointed. Additionally, if the election of Mr. Masahiko Oshima
and Ms. Junko Kogayu is approved, the Company will enter into such agreement with them.
Directors and Officers Liability Insurance Policy:
The Company has entered into a directors and officers liability insurance policy between an insurancecompany in accordance with Article 430-3, Paragraph 1 of the Companies Act. A summary of thecontents of the said insurance policy is as stated in “Summary of Contents of a Directors and Officers
Liability Insurance Policy, etc.” of the Business Report. If the nomination of each candidate for Audit& Supervisory Board Member is approved, they will continue to be included as the insureds under thesaid insurance. The insurance policy will be renewed with the contents unchanged on its next renewal.

[English Translation]

20

Shareholder Proposal (Sixth Item of Business)
The outline of the item of business and reasons for the proposal included here are unchanged fromthe original text of the shareholder proposal.
Sixth Item of Business:
Appropriation of Surplus
Details of Shareholder Proposal
Appropriation of surplus of the company shall be as follows:
If the company’s board of directors proposes an appropriation of surplus at the 97th Annual
General Meeting of Shareholders, this proposal shall be independent of and in addition to the saidboard proposal.
(1) Type of dividend property
Cash(2) The dividend amount per ordinary share
360 yen, less the amount of dividends per share of common stock based on the proposal forthe appropriation of surplus proposed by the board of directors of the company that wasapproved at the 97th Ordinary General Meeting of Shareholders and the amount of interim
dividends per share of common stock of 22 yen for the fiscal year ended March 31, 2024.
(3) Allocation of dividend property and total amount thereof
The amount of dividend per share of common stock of the Company shall be the amount ofdividend per share as described in (2) above.
The total amount of dividends shall be calculated by multiplying the dividend per share by the
total number of common shares outstanding (excluding treasury stock) as of March 31, 2024.
(4) Effective date of distribution of dividends of surplus
The day of the 97th Ordinary General Meeting of Shareholders of the Company
Reasons for the Proposal
At the end of last year, TBS Holdings held investment securities of 800 billion yen or more,accounting for no less than 80% of the company’ total net assets. Hibiki Path Advisors, as theinvestment manager of the proposing shareholder, sent to the company and publicized a letter“Proposals on Measures to Enhance Corporate Value” (Letter-to-TBS_final-English-2.pdf (hibikipath-advisors.com)) in May last year. As stated on pages 8-13 of the letter, while management strategyof the company is highly regarded, we believe that improvement in ROE and achieving a >1.0x PBRof the company can only be realized through a decisive Balance Sheet management, i.e., fixed amountdividend (exceeding the level of profit of the company) for certain consecutive years.
Our proposed dividend amount is approximately ten times as much as the average of amounts ofthe past three years. We consider that the company’s financial soundness would not be deteriorated,through disciplined liquidation of investment securities.
If the proposed agenda is approved, we would request the company to keep the same amount fixed
dividend for a minimum of 5 years, and ideally for 10 years, to strive for continuous improvement in
ROE.

[English Translation]

21

Opinion of the Company’s Board of Directors
The Company’s Board of Directors is opposed to this item of business.
Reasons for opposition
The Company announced the “TBS Group Medium-Term Management Plan 2026” (“MediumTerm Management Plan 2026”) on May 14, 2024.
Medium-Term Management Plan 2026 corresponds to Phase 2 of the Company group’s long-term
management vision, “TBS Group VISION 2030” (“VISION 2030”), announced in May 2021, andpresents the growth strategy for the TBS Group to evolve from a media group to a content groupand the financial strategy to achieve it.
Medium-Term Management Plan 2026 has been deliberated over a long period of time by insideand outside directors who have various skill sets. In particular, with respect to the financial strategy,
Medium-Term Management Plan 2026 manifests that while fulfilling the Company’s social mission
as a key news media outlet, expected to perform the function of a social lifeline, the Company will
propel measures both (i) to achieve sustainable growth as a company and enhance its corporate value
in the medium to long term by continuing to actively make investments that advance the Company’s
growth strategies or its growth investments and (ii) to further increase the return of profits to its
shareholders.
Regarding the return of profits to shareholders, the Company has steadily expanded its returns basedon a diligent study and analysis, taking into account changes in the capital market. As a result,while the former medium-term management plan (“Medium-Term Management Plan 2023”)
initially planned a return of profits to shareholders in a total amount of 25 billion yen (in the Updated
Medium-Term Management Plan 2023 published in May 2022) by way of a dividend throughappropriation of surplus and acquisition of treasury shares (based on the assumption that a year-end
dividend for the fiscal year ended March 31, 2024 is approved at the General Meeting of
Shareholders, as stated in the Company’s proposal “First Item of Business: Appropriation of
Surplus”), the actual value will be expanded greatly to a total amount of 44 billion yen. Moreover,while Medium-Term Management Plan 2023 aimed for a 30% dividend payout ratio on aconsolidated basis, Medium-Term Management Plan 2026 intends to increase it to approximately
40%, in which the Company plans to conduct a return of profits to its shareholders in a total amountof 60 billion yen by flexibly acquiring treasury shares with the total payout ratio in mind.
At the same time, in order for the Company group to continue to grow sustainably, it is essential toexpand its business portfolio. During Medium-Term Management Plan 2023, the Company madea total of 145.1 billion yen in growth investments (planned value: 140 billion yen) to actively
promote its EDGE strategy set in VISION 2030, including having made YARUKI Switch Group
Holdings its consolidated subsidiary and U-NEXT Co., Ltd. its equity-method affiliate. During
Medium-Term Management Plan 2026, the Company plans to continue to make a total of 160 billion
yen in growth investments.
As stated above, for purposes of achieving a return of profit to shareholders and securing financial
sources of capital for growth investments, as well as compliance with the Corporate Governance
Code and balance sheet improvement, the Company has steadily carried out sales of crossshareholdings, and during Medium-Term Management Plan 2023, the Company sold 81.4 billion
yen of cross-shareholdings, which far exceeds the planned value of 60 billion yen. During
Medium-Term Management Plan 2026, the Company plans to expand the size further and sell a
total amount of 90 billion yen or more of cross-shareholdings.
[English Translation]

22

The Company believes that its corporate value in the medium to long term can be enhanced by,among others, realizing the growth and financial strategies set forth in Medium-Term Management
Plan 2026 as well as the return of profit to shareholders as part of the strategies above.
For details of Medium-Term Management Plan 2026, including the financial strategy set forth
therein, please see the following document disclosed on the Company’s website:
https://www.tbsholdings.co.jp/about/pdf/plan_2026.pdf
On the other hand, the Shareholder Proposal requests an annual dividend of 360 yen per share. If
this proposal is adopted, the dividend payout ratio will reach approximately 155%. In addition,
the Proposing Shareholder requests that the Company continue to provide a fixed dividend in thesame amount for at least five years, or if possible, for ten years. If this excessive level ofappropriation of surplus is provided for five years, the total amount thereof will be approximately
300 billion yen, and for ten years, 600 billion yen. An appropriation of surplus on such scale ishighly likely to have a significant impact on both the stable management of the Company group, asa key news media outlet, and its financial foundation necessary for sustainable growth, including
the total of 160 billion yen in growth investments expected to be made during Medium-Term
Management Plan 2026. Accordingly, the Company has to conclude that the Shareholder Proposal
does not take into account enhancement of the Company’s corporate value in the medium to longterm.
Furthermore, the Shareholder Proposal designates the date of the General Meeting of Shareholders
as the effective date of the appropriation of surplus; however, it would be practically impossible tocorrectly and smoothly distribute dividends to shareholders if we were to adopt such effective date,in light of which, the Company also considers the Shareholder Proposal to be inappropriate.
For the reasons above, the Company’s Board of Directors opposes the Shareholder Proposal as it
conflicts with the Company’s policy in which the Company will achieve its medium- to long-term
growth and stably and continuously return profits to its shareholders through steady implementationof the growth and financial strategies set forth in Medium-Term Management Plan 2026 in pursuitof the achievement of VISION 2030.

[English Translation]

23

(Reference)

Shareholder Return Results and Policy

The Company regards the return of profits to shareholders as an important management issue.
During the period of the “TBS Group Medium-Term Management Plan 2023,” TBS has
implemented a consistent and continuous dividend payout ratio of around 30% on a consolidated basis,and together with the flexible acquisition of treasury stock, shareholder returns (total dividends plus
share buybacks) are expected to amount to approximately 44 billion yen.
Under the new “TBS Group Medium-Term Management Plan 2026,” in order to further enhance
the return of profits to shareholders, TBS will raise the dividend payout ratio to around 40% andimplement consistent and continuous dividend payments, while flexibly implementing share buybacks
in consideration of the total return ratio. The Company plans to return a total of 60 billion yen to
shareholders over the three-year period of the plan.
TBS Group Medium-Term Management Plan 2026:
https://www.tbsholdings.co.jp/about/pdf/plan_2026.pdf
Period of Medium-Term Management Plan 2023
(Billions of yen)

Period of Medium-Term Management Plan 2026

Total amount of 44 billion yen

4.2

4.4

10.9

11.5

6.3

7.1

7.3

2021

2022

2023

3.7

Total amount of 60 billion yen
to be returned to shareholders

0.9

(FY)

2024

Total dividends

Purchase of treasury shares[English Translation]

24

2025

2026

(Reference)

Cross-shareholdings

The Company has been progressively reducing cross-shareholdings in accordance with the
Corporate Governance Code.
The Board of Directors verifies the appropriateness of continued cross-shareholdings on an annual
basis, by comprehensively taking into account their economic rationale in terms of holding purposes,
status of relationship and capital cost. The Company classifies cross-shareholdings into three groups,
namely (1) Stocks that are essential for the purpose of core business strategies such as JNN affiliatedstations and advertising companies, (2) Stocks of business partners such as TV sponsors, and (3)Source of capital for funding growth strategies. Stocks categorized in (1) and (2) are sold asappropriate if their significance of holding has deteriorated. Stocks categorized in (3) are sold forfunding strategic investments in a flexible manner.
TBS has sold approximately 81.4 billion yen worth of shares during the three years of the “TBSGroup Medium-Term Management Plan 2023,” and plans to sell more than 90 billion yen worth ofshares during the three years starting in fiscal 2024, the year of the new “TBS Group Medium-Term
Management Plan 2026.” If the plan is implemented, the sale value will be over 243 billion yen overthe nine years starting from FY2018.
Sales Results and Plan

(Billions of yen)

Period of Medium-Term
Management Plan 2023

Period of Medium-Term
Management Plan 2026

Planned amount: ¥60. billion

28.4

32.4

Sold approx. 81.4
billion yen worth

20.1

37.1
Plan to sell more than
90 billion yen worth

24.1

11.0

(FY)

2018

2019

2020

2021

2022

2023

Over ¥243.0 billion[English Translation]

25

2024

2025

2026

Business Report

From April 1, 2023 to March 31, 2024

1. The Current Position of TBS Holdings, Inc. and its Subsidiaries(1) Business Activities and Results
During the fiscal year under review (from April 1, 2023 to March 31, 2024), economic activities in Japan
showed signs of returning to normality following, among others, the reclassification of the category of the novel
coronavirus disease (COVID-19) to Class 5 and the further lifting of restrictions on behavior. At the same time,
however, a recovery in personal consumption came to a standstill, mainly due to rising prices caused by surging raw
material prices, and caution was required against risks of downturns in overseas economies that could put downward
pressure on the domestic economy, such as fluctuating exchange rates, uncertainty in the Chinese economy, and thesituation in the Middle East.
Against this backdrop, consolidated net sales of the Group for the fiscal year ended March 31, 2024
increased 7.1% from the previous fiscal year to ¥394,309 million, thanks to growth in the streaming business and the
new consolidation of YARUKI Switch Group, despite a decrease in TV advertising revenue.
Operating expenses (i.e., cost of sales and selling, general and administrative expenses) increased 9.2%
from the previous fiscal year to ¥379,134 million, mainly due to an increase in program production expenses and the
new consolidation of YARUKI Switch Group.
As a result, operating profit decreased 27.0% from the previous fiscal year to ¥15,175 million, while
ordinary profit decreased 21.2% to ¥27,653 million and profit attributable to owners of parent increased 8.4% to¥38,126 million, mainly due to an increase in gain on sale of investment securities.

[English Translation]

26

Net sales (billions of yen)
368.1

Operating profit (billions of yen)
394.3

20.7

Up 7.1%
yoy

15.1

Down
27.0% yoy

96th fiscal year

96th fiscal year

97th fiscal year

Ordinary profit (billions of yen)

97th fiscal year

Profit attributable to owners of parent (billions of yen)

35.0
35.1

38.1

27.6

Up 8.4%yoy

Down
21.2% yoy

96th fiscal year

[English Translation]

97th fiscal year

96th fiscal year

27

97th fiscal year

<<Media & Content>> Revenue ¥287.8 billion (Up 0.9% year-on-year)
Revenue (billions of yen)
287.8

285.2

Operating profit (billions of yen)
10.9

73.0%
3.9

Ratio of sales

96th fiscal year 97th fiscal year

96th fiscal year 97th fiscal year

In the Media & Content business segment, revenue for the fiscal year under review were ¥287,854 million(up 0.9% year-on-year) and operating profit was ¥3,927 million (down 64.0% year-on-year).
Revenue in the Television division of Tokyo Broadcasting System Television, Inc. for the fiscal year underreview increased ¥7,836 million to ¥201,128 million (up 4.1% year-on-year), with a drop in broadcasting revenue
being covered by the streaming business. Of this total, time revenue was ¥81,590 million (up 2.1% year-on-year),thanks to strong sales in regular programs, as well as contributions from sales of large-scale one-off sports event
programs, such as “World Athletics Championships Budapest 23” and “Asian Games in Hangzhou, China,” andspecial year-end and new-year programs, which achieved record high sales. Spot revenue was ¥77,777 million (down
6.3% year-on-year), due to very difficult market conditions as advertisers’ investment in the Kanto region was
estimated to be 94.2% year-on-year and fell significantly below the previous fiscal year’s level.
On the other hand, advertising revenue through streaming rose to ¥8,243 million (up 45.4% year-on-year),reflecting the strong performance of popular dramas and variety shows, such as “VIVANT” and “Extremely
Inappropriate!,” mainly through TVer. Revenue from paid subscription streaming services grew to ¥12,146 million(up 36.5% year-on-year), thanks to revenue from overseas streaming programs such as “Takeshi’s Castle” and “Let’s
Get Divorced.” Other revenue increased to ¥21,371 million (up 34.9% year-on-year), mainly due to the transfer ofthe media business from the Live Entertainment and Media Business.
Revenue in the Live Entertainment and Media Business of Tokyo Broadcasting System Television, Inc.
for the fiscal year under review decreased ¥8,893 million to ¥18,923 million (down 32.0% year-on-year). Movie
revenue also increased thanks to hit movies such as “TOKYO MER: Mobile Emergency Room - THE MOVIE,” “MyHappy Marriage,” and “Fragments of The Last Will.” In live entertainment, although the long-run performance of“Harry Potter and the Cursed Child” on the TBS 70th anniversary stage and “Sleeping Beauty” by K-BALLET
performed strongly, it was not enough to cover the rebound of the successful “Paris Saint-Germain JAPAN TOUR2022” in the previous fiscal year, and as a result revenue decreased. Animation revenue also decreased due to arebound from the huge hit movie “The Quintessential Quintuplets” in the previous fiscal year. In addition, with thetransfer of the media business to the Television division in the second quarter of the fiscal year under review, overall
division revenue decreased.
Revenue of TBS Radio Inc. decreased ¥352 million to ¥8,137 million (down 4.1% year-on-year) due tolower spot revenue in advertising revenue, although time revenue exceeded that of the previous year.
Revenue of BS-TBS Corporation decreased ¥110 million to ¥17,108 million (down 0.6% year-on-year)
due to struggling time and business revenues, despite strong spot revenue and shopping.
Revenue of TBS GLOWDIA, Inc. increased ¥2,103 million to ¥30,193 million (up 7.5% year-on- year)
due mainly to an increase in DVD revenue.
Revenue of Nichion, Inc. increased ¥696 million to ¥9,271 million (up 8.1% year-on-year) due mainly to
an increase in revenue from Japanese and Western music.
Revenue of TC Entertainment, Inc. increased ¥2,251 million to ¥9,373 million (up 31.6% year-on-year)
due to an increase in DVD sales.
In terms of expenses, expenses increased due mainly to an increase in program production costs, and also
increased in line with streaming revenue. As a result, operating profit in this segment decreased ¥6,983 million to¥3,927 million (down 64.0% year-on-year).

[English Translation]

28

<<Lifestyle>> Revenue ¥89.9 billion (Up 35.4% year-on-year)
Revenue (billions of yen)
89.9

22.8%

Ratio of sales

66.3

96th fiscal year 97th fiscal year

Operating profit (billions of yen)
3.0

4.1

96th fiscal year 97th fiscal year

In the Lifestyle business segment, both revenue and profit increased. Revenue for the fiscal year underreview was ¥89,903 million (up 35.4% year-on-year), and operating profit was ¥4,178 million (up 36.3% year-onyear).
In the StylingLife Group, the core general merchandise retailing business, PLAZASTYLE COMPANY,
achieved an increase in both revenue and profit due to growth in cosmetics and general merchandise, despite a risein the cost of sales ratio and an increase in store operating costs.
The mail-order business, Light-Up Shopping Club Inc., posted declines in both revenue and profit due toa decrease in orders.
In the Beauty & Wellness business, the BCL Company, which engages in development, production andsales of cosmetics, saw continued strong sales in Japan and overseas, and as a result both revenue and profit increased.
As a result, both revenue and profit increased for the StylingLife Group as a whole.
YARUKI Switch Group is involved in the individual education cram school business and the earlychildhood education business. With its new consolidation, both revenue and operating profit in the segment increased.
<<Real Estate & Other>> Revenue ¥16.5 billion (Up 0.3% year-on-year)
Revenue (billions of yen)
16.5

16.5

6.7

4.2%

Ratio of sales

Operating profit (billions of yen)

96th fiscal year 97th fiscal year

7.0

96th fiscal year 97th fiscal year

In the Real Estate & Other business segment, revenue for the fiscal year under review was ¥16,552 million(up 0.3% year-on-year), and operating profit was ¥7,066 million (up 3.9% year-on-year).
Both revenue and profit increased mainly due to an increase in rent income.

[English Translation]29

(2) Capital Investment
Total capital investment in the fiscal year under review was ¥14.9 billion.
Capital investment consists of ¥4,700 million for the Company, ¥6,900 million in Tokyo Broadcasting System
Television, Inc., and ¥1,000 million in the StylingLife Group.
The Company’s major capital investments were related to the M6 studio built in the Midoriyama Studio and
the Planning of Akasaka Entertainment City Initiative. Major capital investments of Tokyo Broadcasting System
Television, Inc. included the upgrading of broadcasting center equipment and studio equipment. Major capital
investments of StylingLife Group were made on PLAZA new store openings, store refurbishment and systems
investment.
(3) Capital Procurement
In the fiscal year under review, due to the new consolidation of YARUKI Switch Group Holdings Co., Ltd.,the borrowing balance of ¥3,783 million of YARUKI Switch Group was recognized as interest-bearing debt of theGroup. Meanwhile, ¥20.0 billion in long-term borrowings, which became due for repayment, was fully repaid. As aresult, the balance of interest-bearing debt of the Group at the end of the fiscal year under review was ¥3,783 million.
(Excluding lease obligations.)
In order to ensure flexible access to operating capital, as of the end of the fiscal year under review, StylingLife
Holdings Inc., a consolidated subsidiary of the Company, had established commitment line agreements totaling ¥5.0
billion with Sumitomo Mitsui Banking Corporation and other one financial institutions (the balance of the funds
drawn is nil, and the available balance is ¥5.0 billion).
(4) Status of Important Reorganization
On June 29, 2023, the Company acquired 78% of the shares of YARUKI Switch Group Holdings Co., Ltd.
and made YARUKI Switch Group Holdings Co., Ltd. and three of its subsidiaries consolidated subsidiaries of theCompany as part of the growth strategy in the intellectual training and education business. The Company alsoacquired additional shares of YARUKI Switch Group Holdings Co., Ltd. on July 31, 2023, bringing the percentage
of voting rights held by the Company to 81%.
In addition, the Company acquired shares of “U-NEXT Co., Ltd.” on April 1, 2023, and acquired additional
shares on June 29, 2023 to strengthen the capital and business alliance, making the company an equity-method
affiliate.
(5) Priorities
We recognize that the greatest challenge for the Group is to continuously improve our corporate value asa company that is sought after by society, even in an unpredictable and ever-changing business environment.
To address these challenges, we formulated “TBS Group VISION 2030” (“VISION 2030”) in May 2021 as our
future vision with a long-term perspective. We then divided the next decade up to FY2030 into three phases,
clarified the role of each period, and formulated a plan toward achieving VISION 2030.
In the face of the external environment surrounding the TBS Group, such as the ever-changing global
situation, demographic trends, and the Japan’s broadcasting and advertising market, we have identified
managerial issues that we need to address in consideration of the Group’s strengths, and are aiming for thevision set forth in VISION 2030.
Outline of “TBS Group VISION 2030”
The Group’s greatest core competence is its ability to “create content.” Amid drastic changes in the media
environment, such as the diversification of lifestyles and the rise of the Internet, we must respond more than ever tothe “trust” of people, “create” wonderful content that enriches their minds and lives, and “expand” (deliver) it beyond
the boundaries of broadcasting. Defining content as all that “moves people’s hearts and minds,” we aim to become
a content group that maximizes the value of such content.
Specifically, we will promote the development of original intellectual property and strengthen our creativity.
We will also promote “EDGE*” as an expansion strategy to infinitely expand the content we create.
* EDGE: Expand Digital Global Experience
We will focus our resources on cultivating digital content by strengthening streaming business (Digital),pursuing further growth in overseas markets (Global), and expanding business where people “experience” our live
entertainment and lifestyle (Experience).

[English Translation]30

In VISION 2030, the Group aims for overall growth by steadily growing growth business areas through the
expansion strategy “EDGE,” even in situations where a significant expansion of the broadcasting and advertisingmarket cannot be expected.
Nevertheless, the broadcasting business is the foundation for this growth, and we will continue to aim toenhance its value. In the future, the broadcasting business will further deepen the value of “trust” that we havecultivated to date, go beyond the function of an advertising medium to become a value co-creation hub, and propose
new value with partners. We will also aim to evolve our media power by promoting data marketing.
As a group that encompasses media with a public and social mission, we will take a variety of measures aspart of our unique ESG management to provide “each ‘moment’” for the earth we live on (Environment), society
and our colleagues (Social), and as a responsible company (Governance). Through our content, we will work together
with all stakeholders to create a happy and sustainable society in which diverse values are respected.
Outline of “TBS Group Medium-term Management Plan 2026”
The “TBS Group Medium-term Management Plan 2026” (“Medium-term Management Plan 2026”)
corresponds to the second phase of VISION 2030.
The first phase (FY2021 to FY2023) was a period for sowing seeds for growth toward VISION 2030. We
made growth investments totaling approximately ¥145.0 billion, focusing particularly on the Digital and Experience
domains within the “EDGE” domain, including investments in paid streaming platforms in Japan, expanding into theearly childhood development and education business, and strengthening the Lifestyle business.
Under the Medium-term Management Plan 2026, we have positioned the expansion of the business portfolio
developed in the first phase into the Global domain as the top priority and formulate a plan for a medium- to longterm global strategy to accelerate growth, in order to make this the “TBS Global Business Inaugural Year.”Furthermore, we have formulated a plan to promote the growth of the seeds sown in the first phase, continue to sow
seeds in growth areas, and acquire and enhance content IP, aiming for revenue of ¥450.0 billion and operating profitof ¥24.0 billion by FY2026.
Measures to achieve the “TBS Group Medium-term Management Plan 2026”[Strengthening and leveraging content IP creation capabilities]
The core competence of the TBS Group is content production capabilities, from which content IP is generated.
In addition to the core content centered around video and audio, such as dramas, news reports, variety shows, andanimation, new content was also acquired in the process of growth investment in the first phase.
Under the Medium-term Management Plan 2026, the TBS Group will create an environment in which all of
its 8,000 employees can generate diverse ideas, develop discerning planning skills, and enhance marketing abilities
to select superior content IP. We will also refine technology and design capabilities and establish a system capableof creating even stronger content IP.
By leveraging both quality and quantity of strong content IP, we aim to accelerate TBS’s growth not only inbroadcasting but in the “EDGE” domain, as we strive to pursue and provide “Timeless Value” as value that willtranscend the times and remain in everyone’s hearts and minds.
We will not only develop content IP by ourselves, but also acquire IP through investment. By strengthening
content IP, we aim for not only business growth in the “EDGE” domain, but also to achieve the highest television
audience ratings across all time slots and the number one spot for free streaming views, and in the broadcasting
business, we approach this with the unyielding resolve that we must aim for number one in order to survive.
[Expansion of business portfolio through new business creation]
In the Medium-term Management Plan 2026, we classify the broadcasting business such as the terrestrial
advertising business, which is a traditional main revenue source, and the free streaming business, as “stable revenue
areas,” growth areas that we actively invested in the first phase, such as the paid streaming business and the earlychildhood development and education business, as “growth focus areas,” and furthermore, designates the global
business area that was addressed in FY2024 as the “TBS Global Business Inaugural Year,” along with new areas tobe aggressively addressed, such as new IP strategy, as “seeding areas.” By clarifying these areas, the Plan facilitates
the expansion and continuous review of the business portfolio, enabling the optimal allocation of content IP.
[Capital allocation and shareholder returns with an awareness of capital efficiency]
In order to comply with the Corporate Governance Code and promote management with awareness of capitalefficiency, we will accelerate the sale of cross-shareholdings and use the proceeds from the sale of crossshareholdings and operating cash flow to make growth investments worth ¥160.0 billion, with the aim of increasing
31[English Translation]

medium- to long-term profit and improve capital efficiency. Furthermore, we will provide stable and continuous
shareholder returns through dividends and flexible purchases of treasury shares.
TBS Group Materialities
In May 2022, we announced the TBS Group Materialities as key issues that must be addressed in order toachieve the expansion strategy “EDGE” set forth in VISION 2030 and promote ESG management, based on theGroup’s corporate philosophy and Brand Promise.
In the Medium-term Management Plan 2026, we will continue to promote corporate management from theperspectives of both improving corporate value and fulfilling our social responsibility.

[English Translation]32

(6) Assets and Profit/Loss
Assets and Profit/Loss of the Group
94th Business Term

Category

Year ended
March 31, 2021

95th Business Term
Year ended
March 31, 2022

96th Business Term
Year ended
March 31, 2023

97th Business Term

Year ended
March 31, 2024
(fiscal year under review)

Net sales
325,682358,269
368,130
394,309(millions of yen)
Operating profit
10,841
20,346
20,782
15,175(millions of yen)
Ordinary profit
19,23330,70735,08627,653(millions of yen)
Profit attributable toowners of parent
28,07232,00835,182
38,126(millions of yen)
Earnings per share
164.32
187.35208.76232.28(yen)
Net assets
794,884
883,002796,184
1,149,947(millions of yen)
Total assets
1,100,223
1,201,632
1,067,865
1,567,504(millions of yen)
Note: The Company has applied the “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29,
March 31, 2020) and relevant ASBJ regulations from the beginning of the 95th business term.

Net sales (billions of yen)

Operating profit (billions of yen)
394.3

358.2

368.1
20.3

325.6

20.7
15.1

10.8

94th fiscal
year

95th fiscal
year[English Translation]

96th fiscal
year

97th fiscal
year

94th fiscal
year

33

95th fiscal
year

96th fiscal
year

97th fiscal
yearOrdinary profit (billions of yen)

Profit attributable to owners of parent(billions of yen)

35.0
30.7

32.0

27.6

38.1

35.1

28.0

19.2

94th fiscal
year

95th fiscal
year

96th fiscal
year

97th fiscal
year

94th fiscal
year

95th fiscal
year

96th fiscal
year

97th fiscal
year(7) Status of Parent Company and Principal Subsidiaries
1. Parent Company
TBS Holdings, Inc. has no parent company.
2. Principal Subsidiaries (As of March 31, 2024)
Capital stock
Company name(millions of yen)
TBS Radio, Inc.
100
Tokyo Broadcasting System
Television, Inc.

Voting rights
owned (%)
100

100

100

5,844

100

50

100

50

100

TBS ACT, INC.

50

100

THE SEVEN, INC.

50

100

TBS Media ResearchInstitute Inc.

12

100

US$3.28 million

100

BS-TBS, INC.

TBS SPARKLE, Inc.

TBS GLOWDIA, Inc.

Tokyo Broadcasting System
International, Inc.

[English Translation]

34

Main business activities
Radio broadcasting
Planning and production of radio
programs
Television broadcasting
Planning, production and sales of
television programs etc.
Provision of broadcast services via
broadcast satellites, planning,production and sales of programming
etc.
Program production (dramas, variety
shows, news reports, information,
sports, and others), content production
etc.
Sales of programs and software,
shopping business, planning andproduction of events and radio
programs, digital technology
Technology, art, and computer
graphics (CG)-related operations for
program production, content
production, etc.
Planning, production, distribution andsales of content
Surveys and research on broadcasting
and multimedia, collection and supply
of media information
Collection of media information andnews coverage in the United States

Capital stock(millions of yen)

Voting rights
owned (%)

50

100

10

100

100

90

200

51

100

51

100

70

100

* 100

100

* 100

YARUKI Switch Group
Holdings Co., Ltd. (Note 4)

208

81

YARUKI Switch Group Co.,
Ltd. (Note 4)

10

* 100

YARUKI Switch CareersCo., Ltd. (Note 4)
YP Switch Co., Ltd. (Note 4)

30

* 100

50

* 50

100

100

150

100

40

100

100

100

400

70

Company name
Nichion, Inc.

Seven Arcs Co., Ltd.

CS-TBS, Incorporated
TC Entertainment, Inc.
Manga Box Co., Ltd.
StylingLife Holdings Inc.
(Note 3)
LightUp Shopping Club Inc.
CP Cosmetics Inc.

Midoriyama Studio City Inc.
TBS Kikaku Co., Ltd.
TBS Sun Work, Inc.

TBS HEXA. Inc.
Akasaka Heat Supply Co.,
Ltd.

Note 1:
Note 2:
Note 3:Note 4:Note 5:Main business activities
Administration and development of
copyright, scout and development ofartists, song pitching, planning andproduction of master recordings etc.
Planning and production of TV
animation, theater pieces, games etc.,
sale of goods, copyright managementetc.
Approved basic broadcast services
using a communications satellite
Planning, production and duplication
etc. of video and audio software andcomputer software
Electronic publication business
Planning of management strategy as an
operating holding company, generalimported merchandise retail business,
production and sales of cosmetics etc.
Store and non-store sales of cloths,
sports and leisure goods, electronic
products, and household products
Development, production and sales ofcosmetics and quasi drugs etc.
Management and administration of aholding company and the entire group,etc.
Management of the individual
education cram schools, English
conversation schools, early childhood
education and private-type childcare
facilities, and their franchise businesses
Hiring-related operations, etc. within
YARUKI Switch GroupManagement of programming schools,
etc.
Operation and management ofbuildings, studios etc.
Operation and management of parking
lots, insurance agency services
Operation, maintenance andmanagement of buildings and auxiliary
facilities, temporary staffing service,etc.
Real estate business
Heat supply services under the Heat
Supply Business Act

The 26 principal subsidiaries above are consolidated subsidiaries of the Company.
An asterisk (*) indicates the shareholding ratio, including shares held by subsidiaries, parties closely connected with theCompany, and parties having agreements with the Company.
On September 27, 2023, the StylingLife Holdings Inc., carried out purchase of treasury shares, thus changing the ratio ofvoting rights owned by the Company.
On June 29, 2023, the Company made YARUKI Switch Group Holdings Co., Ltd. and three of its subsidiaries consolidated
subsidiaries of the Company as part of a growth strategy in the intellectual training and education business (refer to 1. (4)“Status of Important Reorganization” of Business Report).
The state of specified wholly-owned subsidiaries at the end of the fiscal year under review is as in the following.

Name of specified wholly-owned subsidiary[English Translation]

Tokyo Broadcasting System Television, Inc.

35

Address of specified wholly-owned subsidiaryBook value of shares of specified wholly-owned
subsidiary of the Company or wholly-owned
subsidiary thereof
Total assets of the Company[English Translation]

5-3-6 Akasaka, Minato-ku, Tokyo¥243,580 million¥1,211,256 million36(8) Main Business Activities (As of March 31, 2024)
The core activities of the Group are television and radio broadcasting, and related businesses, lifestylebusiness, and real estate business. Other areas of activity include services and maintenance incidental to these core
activities.
Business activities in the fiscal year under review were as follows:
Segment
Activities
Media & Content* Broadcasting-related businessBroadcasting, program production, video technology, art production,
VFX, audio technology, lighting technology, camera filming, video
investment, surveys and research etc.

Lifestyle
Real Estate & Other* Events, planning and production of video software etc., CS business,computer software planning and development
Production, sales and streaming of video and audio software, events andprograms, program syndication, production and sales of video software,planning and production of animation and comics, planning andproduction of audio software etc.
Mail-order marketing, retail of general merchandise, production andsales of cosmetics, early childhood development and education business,etc.
* Real estate leasing, maintenance and services
Studio management, cooling and heating control services, parking lot
management, equipment leasing, insurance agency services, real estateleasing etc.

(9) Principal Sales Office (As of March 31, 2024)
1. TBS Holdings, Inc.
Sales Office
Head office and studios

Location
5-3-6 Akasaka, Minato-ku, Tokyo

2. Subsidiaries

Company name
TBS Radio, Inc., Tokyo Broadcasting System Television, Inc. (Note 1),
BS-TBS, INC., TBS SPARKLE, Inc., TBS GLOWDIA, Inc.,
TBS ACT, INC., THE SEVEN, Inc.,
TBS Media Research Institute Inc., Nichion, Inc.,
CS-TBS, Incorporated, TC Entertainment, Inc., Manga Box Co., Ltd.,TBS Kikaku Co., Ltd., TBS Sun Work, Inc., TBS HEXA. Inc.,
Akasaka Heat Supply Co., Ltd.
StylingLife Holdings Inc. (Note 2)
LightUp Shopping Club Inc.
CP Cosmetics Inc. (Note 3)
YARUKI Switch Group Holdings Co., Ltd. (Note 4), YARUKI Switch
Group Co., Ltd. (Note 5), YARUKI Switch Careers Co., Ltd., YP
Switch Co., Ltd.
Seven Arcs Co., Ltd.
Midoriyama Studio City Inc.

Location

Minato-ku, Tokyo

Shinjuku-ku, Tokyo
Chuo-ku, Tokyo

Musashino City, Tokyo
Yokohama City, Kanagawa
Prefecture
Tokyo Broadcasting System International, Inc.
New York, U.S.A.
Note 1:
Tokyo Broadcasting System Television, Inc. has Kansai Branch Office in Osaka City, Osaka Prefecture,a TV studio in Yokohama City, Kanagawa Prefecture, and a TV transmitter station in Sumida-ku, Tokyo.
Note 2:StylingLife Holdings Inc. operates a nationwide store network in Japan consisting of 132 “PLAZA” and“MINiPLA” stores, etc. and a sales office in Osaka City, Osaka Prefecture and has its main plant inYaizu City, Shizuoka Prefecture.
Note 3:
CP Cosmetics Inc. has sales offices in Shinagawa-ku, Tokyo, Sapporo City, Hokkaido, Nagoya City,
Aichi Prefecture, Osaka City, Osaka Prefecture, and Fukuoka City, Fukuoka Prefecture.

[English Translation]

37

Note 4:Note 5:YARUKI Switch Group Holdings Co., Ltd. operates 2,397 schools, etc. through its subsidiaries andaffiliates (as of February 29, 2024).
YARUKI Switch Group Co., Ltd. has a Western Japan Branch Office in Kobe City, Hyogo Prefecture.

(10) Work Force (As of March 31, 2024)
Segment
Number of employees

Change since end of previous
fiscal year
Media & Content
4,529
Decrease of 18
Lifestyle2,839
Increase of 1,421
Real Estate & Other
67
Decrease of 17
Corporate (shared)
557
Increase of 20
Total
7,992
Increase of 1,406
Note:
Number of employees classed as “corporate (shared)” are administrative employees who cannot beallocated to any specific segment.

(11) Main Lenders (As of March 31, 2024)
LenderAmount (millions of yen)
Syndicated loan (Note 1)—
MUFG Bank, Ltd. (Note 2)
3,043
Mizuho Bank, Ltd. (Note 2)740
Note 1:As described in the “Capital Procurement” of Business Report, a syndicated loan became due forrepayment on October 13, 2023 and was repaid in full.
Note 2:The lender is a lender of YARUKI Switch Group Co., Ltd., a consolidated subsidiary of the Company.
Note 3:StylingLife Holdings Inc., a consolidated subsidiary of the Company, has signed agreements with
Sumitomo Mitsui Banking Corporation and one other financial institution to establish ¥5.0 billion
commitment line in total.
(Refer to “Capital Procurement” of Business Report: the balance of the funds drawn is nil, and theavailable balance is ¥5.0 billion)[English Translation]38

2. The Current Position of TBS Holdings, Inc.
(1) Common Stock (As of March 31, 2024)
1. Total Number of Shares Issuable
400,000,000 shares
2. Issued Number of Shares

168,591,065 shares

3. Number of Shareholders

15,275

4. Major Shareholders and Number of Shares Held (Top 10)
Shareholders
Number of shares held (shares)
Percentage of shares held (%)
The Master Trust Bank of Japan, Ltd.
14,514,600
8.78(Trust Account)
The Master Trust Bank of Japan, Ltd.
(Pension Account-Pension Trust
9,310,500
5.63
Account held for DENTSU INC.)
MBS MEDIA HOLDINGS, INC.
8,848,100
5.35
Mitsui Fudosan Co., Ltd.
5,713,728
3.45
NTT DOCOMO, INC.
5,713,000
3.45
Nippon Life Insurance Company
5,006,235
3.03
STATE STREET BANK AND
4,317,555
2.61
TRUST COMPANY 505001
BIC CAMERA INC.
4,190,000
2.53
KODANSHA LTD.
3,771,200
2.28
Custody Bank of Japan, Ltd. (Trust
3,556,300
2.15
Account)
Note 1:
Percentage of shares held was calculated excluding its treasury share (3,424,450 shares) and rounded
down to two decimals.
Note 2:The percentage of voting rights held by foreign shareholders at the end of the fiscal year under review,
as defined in the Broadcasting Act, was 16.74%.
Note 3:9,310,500 shares held by The Master Trust Bank of Japan, Ltd. (Pension Account-Pension Trust
Account held for DENTSU INC.) are the Company’s shares owned by DENTSU INC. and depositedin DENTSU INC.’s pension trust.
5. Status of Shares Issued to Officers of the Company as Remuneration for Executing Duties During the Fiscal
Year under Review
Number of Directors eligible
for issuanceDirectors (excluding Outside Directors)
33,748 shares
6 persons
Note:
Details of the Company’s share-based remuneration are described in “Matters Related to Resolution of
the General Meeting of Shareholders on Remuneration, etc. of Directors and Audit & Supervisory
Board Members” and “Matters Related to Determination Policy on Details of Remuneration, etc. for
Each Individual Director” of the Business Report.
Number of shares[English Translation]

39

6. Other Important Matters Concerning Shares
At the meeting of the Board of Directors held on November 10, 2023, the Company resolved on purchase oftreasury shares pursuant to the provisions of Article 156 of the Companies Act, as applied mutatis mutandis
pursuant to Article 165, Paragraph 3 of the same act following the deemed replacement of terms, as well as on
cancellation of treasury shares pursuant to the provisions of Article 178 of the Companies Act, and carried out
both purchase and cancellation, with the aim of returning profits to shareholders and improving capitalefficiency.
Purchase of treasury shares
Type of shares purchased
Total number of shares purchased
Total purchase price of shares
Period of purchase
Cancellation of treasury shares
Type of shares canceled
Total number of shares canceled
Date of cancellation

Common stock
3,363,800 shares¥10,999,671,661
From November 13, 2023 to February 29, 2024
(on an agreement basis)
Common stock
3,000,000 shares
November 30, 2023

In addition, at the meeting of the Board of Directors held on February 9, 2023, the Company introduced an
incentive plan using a trust (Stock-Granting ESOP Trust) for employees of Tokyo Broadcasting System
Television, Inc., a wholly-owned subsidiary of the Company, for the purpose of enhancing employee welfare
and increasing corporate value over the medium to long term. As of March 31, 2024, 3,437,230 shares of theCompany were held by the Stock-Granting ESOP Trust Account.
Certain subsidiaries of the Company introduced a share-based remuneration system using a trust (Share Grant
Trust Account for Directors) for Directors on June 29, 2023. The purpose of this system is to use shares of theCompany to clarify the linkage between remuneration for the Subsidiary Directors and the value of shares of theCompany. As of March 31, 2024, 62,500 shares of the Company were held by the Share Grant Trust Account for
Directors.

[English Translation]40

(2) Corporate Officers
1. Directors and Audit & Supervisory Board Members (As of March 31, 2024)
Position
Name
Areas of responsibility
Chairman andShinji Takeda
Chair of Board of Directors
Director
President and Chief Takashi Sasaki
Office of Internal Audit
Executive Officer
Representative
Toshiaki Kawai
Head of financial strategy
Director
Director
Tatsuo Sugai
Head of growth strategy
Director
Shoichi Watanabe
Head of competitive strategy
Director
Masaya Chisaki
Head of ESG strategy
Director
Hitoshi Kashiwaki
Director
Yosuke Yagi
Director
Makoto Haruta
Director
Natsuko Takei
Standing Statutory Tomohiko Nishino
Audit &
Supervisory Board
MemberStanding Statutory Tetsuya Ichikawa
Audit &
Supervisory Board
MemberAudit &
Teisuke Kitayama
Supervisory Board
MemberAudit &Mie Fujimoto
Supervisory Board
MemberAudit &
Somitsu Takehara
Supervisory Board
Member
Note 1: Among the Directors, Mr. Hitoshi Kashiwaki, Mr. Yosuke Yagi, Mr. Makoto Haruta and Ms. Natsuko Takei
are Outside Directors.
Note 2: Among the Audit & Supervisory Board Members, Mr. Teisuke Kitayama, Ms. Mie Fujimoto and Mr.
Somitsu Takehara are Outside Audit & Supervisory Board Members.
Note 3: The Company has registered Directors Mr. Hitoshi Kashiwaki, Mr. Yosuke Yagi, Mr. Makoto Haruta and
Ms. Natsuko Takei, and Audit & Supervisory Board Members, Mr. Teisuke Kitayama, Ms. Mie Fujimotoand Mr. Somitsu Takehara as Independent Directors/Audit & Supervisory Board Members with the Tokyo
Stock Exchange.
Note 4: Audit & Supervisory Board Member Mr. Somitsu Takehara is well versed in accounting and finance as acertified public accountant, and has considerable knowledge of accounting and finance as a certified public
accountant.

[English Translation]

41

Note 5: Important positions of other organizations concurrently assumed by Directors and Audit & Supervisory
Board Members relevant to the fiscal year under review are as follows. There are no special relationships
between the Company and the companies where Outside Officers (*) hold concurrent positions.
Category

Name

Shinji Takeda

Takashi Sasaki
Toshiaki Kawai

Tatsuo Sugai
Directors

Shoichi Watanabe
Masaya Chisaki
Hitoshi Kashiwaki(*)

Yosuke Yagi(*)

Makoto Haruta(*)

Natsuko Takei(*)

Tomohiko Nishino
Audit & Supervisory Board Member

Tetsuya Ichikawa

Teisuke Kitayama(*)

Mie Fujimoto(*)

Somitsu Takehara(*)[English Translation]

Company in which Directors and Audit& Supervisory Board Members of theCompany hold a concurrent position
Tokyo Broadcasting System Television,
Inc.
MBS MEDIA HOLDINGS, INC.
CHUBU-NIPPON BROADCASTING
CO., LTD.
Tokyo Broadcasting System Television,
Inc.
The Mainichi Newspapers Group
Holdings Co., Ltd.
Tokyo Broadcasting System Television,
Inc.
Tokyo Broadcasting System Television,
Inc.
THE SEVEN, INC.
U-NEXT Co., Ltd.
Tokyo Broadcasting System Television,
Inc.
Tokyo Broadcasting System Television,
Inc.
Matsuya Co., Ltd.
Kewpie Corporation
People First, Ltd.
ICMG Co., Ltd.
IWNC Inc., Ltd.
GE Healthcare Japan Corporation
betaCatalyst Inc.
ExaWizards Inc.
Money Forward, Inc.
Panasonic Corporation
Sony Institute of Higher Education
Tokyo Metro Co., Ltd.
Tokyo Broadcasting System Television,
Inc.
TBS GLOWDIA, Inc.
BS-TBS, INC.
TBS ACT, INC.
Tokyo Broadcasting System Television,
Inc.
TBS Radio, Inc.
TBS SPARKLE, Inc.
Nichion, Inc.
StylingLife Holdings Inc.
Tokyo Broadcasting System Television,
Inc.
Sumitomo Mitsui Banking Corporation
Daicel Corporation
Tokyo Broadcasting System Television,Inc.
TMI Associates
EBARA CORPORATIONZECOO Partners Inc.

42

Concurrent position held
Chairman and Director
Outside Director
Outside Director
CEO
Outside Director
Executive Vice President and Board
Director
Senior Managing Director
CEO
Director
Managing Director
Managing Director
Outside Director
Outside Director
Representative Director
Director
Chairman and Director
Audit & Supervisory Board Member
Representative Director and CEO
Representative Director & President
Adviser
Director
Director
External Member of the Board
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
Audit & Supervisory Board Member
AdvisorIndependent Director
Audit & Supervisory Board Member
Partner (lawyer)
Independent Director
Director and Chairman

2. Amounts of Remuneration etc. for Directors and Audit & Supervisory Board Members

Category

Directors(subtotal: Outside Directors)
Audit & Supervisory Board
Members(subtotal: Outside Audit &Supervisory Board
Members)
Total(subtotal: Outside Officers)

Note 1:
Note 2:
Note 3:Note 4:Note 5:

Total amountof
remunerationetc.
(million yen)
436
(36)

Total amount of remuneration etc. by type(million yen)
PerformanceNon-monetaryBaselinkedremuneration,
remuneration
remuneration,
etc.
etc.
238
109
88
(36)
(–)
(–)

Number of
eligible
officers
10
(4)

87
(27)

87
(27)

–

–

5
(3)

523
(63)

325
(63)

109
(–)

88
(–)

15
(7)

The above total amount of remuneration etc. for Directors does not include salaries paid to directors who were also employees.
Outside Audit & Supervisory Board Members, who concurrently serve at the subsidiaries of the Company, do not receive
remuneration from said subsidiaries.
Performance-linked remuneration, etc. consists of performance-linked assessment remuneration and qualitative assessment
remuneration. Amount or number of performance-linked assessment remuneration is to be calculated based on the ratio of theactual consolidated operating income to the projected consolidated operating income in the financial forecast for the fiscal
year subject to assessment disclosed in the Consolidated Financial Results for the previous fiscal year-end. The payment rateis determined based on the 86% achievement rate of performance. With respect to qualitative assessment remuneration, thepayment rate is determined based on the seven-grade evaluation of the Director subject to assessment in terms of qualitative
performance and achievement status as a Director in charge of strategy.
Non-monetary remuneration, etc. shall be a share-based remuneration, a restricted share-based remuneration (RS), as resolvedin the General Meeting of Shareholders and the Board of Directors. Specifically, there shall not be more than 90,000 commonshares per year, and remuneration provided to grant restricted shares shall be monetary remuneration receivables. Eligible
Directors shall pay the monetary remuneration receivables provided in full amount as property contributed in kind, and receive
the Company’s common shares issued. The transfer restriction period, handling in the case of retirement from office, liftingof transfer restrictions, and handling in case of reorganization, etc. are specified for the shares issued.
The above total amount of remuneration, etc. associated with restricted share-based remuneration includes amounts recorded
as expenses for the fiscal year under review.

3. Matters Related to Resolution of the General Meeting of Shareholders on Remuneration, etc. of Directors andAudit & Supervisory Board Members
The amount of monetary remuneration for Directors was resolved to be not more than ¥900 million per year (ofwhich remuneration for Outside Directors to be not more than ¥60 million per year; not including any employee
salary portion payable to Directors who also serve as employees) at the 87th Ordinary General Meeting of
Shareholders held on June 27, 2014. The number of Directors at the conclusion of the said Ordinary General
Meeting of Shareholders was fourteen (14) (of which four (4) were Outside Directors). In addition, within theabove-mentioned remuneration limit and aside from the said monetary remuneration, the share-based
remuneration amount was resolved to be not more than ¥180 million per year with an upper limit for number ofshares to be not more than 90,000 shares per year (Outside Directors not subject to granting) at the 92nd Ordinary
General Meeting of Shareholders held on June 27, 2019. The number of Directors (excluding Outside Directors)
at the conclusion of the said Ordinary General Meeting of Shareholders was thirteen (13). With respect to restricted
share-based remuneration, a resolution was passed at the 96th Ordinary General Meeting of Shareholders held on
June 29, 2023 to change the conditions for lifting the transfer restrictions pertaining to the term of office of the
Eligible Directors from “as a Director of the Company” to “as an officer or employee of the Company or its
subsidiary with specific position designated in advance by the Board of Directors of the Company.” At the said
Ordinary General Meeting of Shareholders, it was resolved that the maximum amount of remuneration for
Directors would remain unchanged and only the portion of remuneration for Outside Directors would be revised
to an annual amount not exceeding ¥80 million. The number of Directors at the conclusion of the said Ordinary
General Meeting of Shareholders was ten (10) (of which four (4) were Outside Directors).
The amount of monetary remuneration for Audit & Supervisory Board Members was resolved to be not morethan ¥100 million per year at the 87th Ordinary General Meeting of Shareholders held on June 27, 2014. The
number of Audit & Supervisory Board Members at the conclusion of the said Ordinary General Meeting of
Shareholders was five (5).

[English Translation]

43

The amount of remuneration for Audit & Supervisory Board Members shall be determined by deliberation of
the Audit & Supervisory Board Members within the limit of the total amount of annual remuneration.
4. Matters Related to Determination Policy on Details of Remuneration, etc. for Each Individual Director<Determination method of the determination policy>
At the meeting of the Board of Directors held on April 22, 2021, the Company resolved a determination policy
on details of remuneration, etc. for each individual Director.
<Basic remuneration policy>
With regard to Directors’ remuneration of the Company, the following basic policy is adopted based on thereport from the Remuneration Advisory Committee at the request of the Board of Directors.
・ The remuneration system shall secure and maintain talented human resources so as to enhance corporate value
and fulfill our public mission, and serve as a stable business foundation.
・ The remuneration system shall focus on the shareholders’ point of view and further share value withshareholders.
・ The determination process shall be objective and highly transparent through deliberation of the Remuneration
Advisory Committee.
<System and other aspects of Directors’ remuneration>
The system, level, structure, etc. of Directors’ remuneration of the Company are deliberated by the
Remuneration Advisory Committee at the request of the Board of Directors in accordance with the basic
remuneration policy, and determined based on the report therefrom.
<Determination policy of remuneration>
The Company has developed a determination policy in regard to details of remuneration, etc. for each individual
Director (hereinafter referred to as “Determination Policy”) as follows.
In regard to the determination policy on amount of remuneration, etc. for each individual Director or the methodof calculating such, the base remuneration, representing the basis of remuneration, shall be a fixed monetary
remuneration. Base remuneration shall be determined for each Director as a monthly remuneration with matterssuch as title, strategic division they are responsible for, and change in business environment taken into account.
The remuneration is paid on a monthly basis.
In regard to the determination policy on the contents of performance indicators associated with performancelinked remuneration, etc., and amount or method of calculating such, the performance-linked remuneration shallbe a variable monetary remuneration. As an annual incentive remuneration, performance-linked remuneration
shall be determined by the Board of Directors following a qualitative assessment of the level of achievement of
the numerical target for consolidated operating profit under the Medium-term Management Plan and achievement
status of the strategic divisions each Director is responsible for, and deliberation by the Remuneration Advisory
Committee. The remuneration shall be paid with the aim of motivating Directors to achieve good single-fiscalyear performance.
The contents of the said performance indicators and the reason for selecting them is to motivate Directors toachieve good single-fiscal-year performance and continuously enhance corporate value, adequately sharing the
profits with shareholders.
In regard to the determination policy on the contents of non-monetary remuneration, etc. and amount or methodof calculating such, share-based remuneration, as long-term incentive remuneration linked to stock price, withrestricted shares shall be annually issued to motivate Directors to enhance the medium- to long-term shareholder
value and to share the value with shareholders.
In regard to the determination policy on the ratio between the base remuneration, performance-linked
remuneration, and non-monetary remuneration for the remuneration, etc. for each individual Director, Directors’
remuneration shall be composed of base remuneration, performance-linked remuneration, and non-monetary
remuneration, while Outside Directors’ remuneration shall be only base remuneration. The said remuneration shallbe deliberated by the Remuneration Advisory Committee at the request of the Board of Directors in accordancewith the basic remuneration policy, and determined based on the report therefrom.
The contents of remuneration, etc. for each individual Director for the fiscal year concerned shall be deliberated
by the Remuneration Advisory Committee at the request of the Board of Directors, and further determined by the
Board of Directors based on a report therefrom. Therefore, the Board of Directors judges that contents are inaccordance with the determination policy.
44[English Translation]

5. Matters Related to Delegation on Determining Details of Remuneration, etc. for Each Individual Director
Based on the delegation of authority resolution by the Board of Directors, determination of remuneration amount,etc. for each individual Director in the Company is to be made by President and Chief Executive Officer Takashi
Sasaki after a report from the Remuneration Advisory Committee.
The authority to determine remuneration, etc. on an individual basis is delegated as determination by the
President and Chief Executive Officer who controls and supervises business execution. This is thought to beappropriate when details of remuneration are determined by assessing the performance of Directors responsible
for each strategic division while the Company’s overall performance is comprehensively viewed.
Determination measures are taken by the Board of Directors within the scope of its authorization by having theRemuneration Advisory Committee deliberate to ensure the said authorization is properly exercised by the Chief
Executive Officer, and considering the report therefrom. As the remuneration amount for each individual Director
is determined by following such procedure, the Board of Directors judges that the contents are in accordance withthe determination policy.
6. General Intent of Limited Liability Agreement
The Articles of Incorporation of the Company include provisions on limited liability agreements with Outside
Directors and Outside Audit & Supervisory Board Members.
The general intent of the limited liability agreement that the Company entered into with each of the Outside
Directors and Outside Audit & Supervisory Board Members pursuant to the Articles of Incorporation is as follows:・ After entering into the agreement, the liability of an Outside Director or an Outside Audit & Supervisory Board
Member pursuant to Article 423, Paragraph 1 of the Companies Act is limited to the minimum amountstipulated in Article 425, Paragraph 1 of the Companies Act in the absence of ill intent and gross negligenceon the part of the relevant director or audit & supervisory board member in the execution of his or her
responsibilities.
7. Summary of Contents of a Directors and Officers Liability Insurance Policy, etc.
(a) Scope of the insured
Directors, Audit & Supervisory Board Members and Executive Officers of the Company and Directors andAudit & Supervisory Board Members of Tokyo Broadcasting System Television, Inc.
(b) Summary of compensation
The directors and officers liability insurance policy is an insurance policy which compensates damages andlitigation costs, etc. incurred by the insured as a result of a claim against the insured from an action (including
inaction) taken associated with duties as officer. However, criminal acts such as bribery and damages, etc. incurredby the officer in person by intentionally performing an illegal act shall not be subject to the compensation. By
doing so, measures are taken so as not to impair the adequacy of business execution by officers, etc. The insurance
premium is borne by the Company in full amount and the policy is annually renewed. The next renewal will bemade with the contents unchanged.
8. Items Pertaining to Outside Officers
Principal Activities in the Fiscal Year under Review
Outside Directors
Name

Attendance to meetings of theBoard of Directors

Hitoshi Kashiwaki

13/13

Yosuke Yagi

13/13

[English Translation]

Status of expression of opinions and summary of duties performedin regard to expected roles
With extensive experience and a high degree of knowledge as amember of the top management of an operating company, Mr.
Kashiwaki gives valuable opinions and suggestions to the
management and supervision over and advice regarding duties
executed by Directors, toward the execution of the growth strategy“EDGE” set forth in TBS Group VISION 2030 and continuous
enhancement of the corporate value of the Group, appropriately
playing his role.
With extensive experience and a high degree of knowledge as thehead of human resources strategy and a member of the top
management of an operating company, Mr. Yagi gives valuable
opinions and suggestions to the management and supervision over
and advice regarding duties executed by Directors, toward theexecution of the growth strategy “EDGE” set forth in TBS GroupVISION 2030 and continuous enhancement of the corporate value of
the Group, appropriately playing his role.

45

Name

Attendance to meetings of theBoard of Directors

Makoto Haruta

13/13

Natsuko Takei

10/10

Note:

Status of expression of opinions and summary of duties performedin regard to expected roles
With extensive experience and a high degree of knowledge as thehead of financial strategy and a member of the top management of an
operating company, Mr. Haruta gives valuable opinions andsuggestions to the management and supervision over and advice
regarding duties executed by Directors, toward the execution of thegrowth strategy “EDGE” set forth in TBS Group VISION 2030 andcontinuous enhancement of the corporate value of the Group,
appropriately playing his role.
With extensive experience and a high degree of knowledge as thehead of legal affairs and compliance at an operating company, Ms.
Takei gives valuable opinions and suggestions to the management aswell as supervision over and advice regarding duties executed by
Directors, toward the execution of the growth strategy “EDGE” set
forth in TBS Group VISION 2030, especially in promoting activities
in the global domain, and continuous enhancement of the corporate
value of the Group, appropriately playing her role.

Audit & Supervisory Board Member Ms. Natsuko Takei was newly elected at the 96th Ordinary
General Meeting of Shareholders held on June 29, 2023, and therefore the number of meetings of theBoard of Directors differs from that of other Audit & Supervisory Board Members.

Outside Audit & Supervisory Board Members
Attendance
to meetingsof the Boardof Directors

Attendance tomeetings of
the Audit &Supervisory
Board

Teisuke Kitayama

12/13

12/14

Mie Fujimoto

12/13

13/14

Somitsu Takehara

13/13

14/14

Name

[English Translation]

Status of expression of opinions
Mr. Kitayama asks questions and gives advice based on extensive
experience and high degree of knowledge as a member of the top
management of a financial institution.
Ms. Fujimoto asks questions and gives advice based on extensive
experience and high degree of knowledge as a lawyer specialized incorporate legal affairs.
Mr. Takehara asks questions and gives advice based on extensive
experience and high degree of knowledge as a certified public
accountant and a member of the top management of a company.

46

(3) Accounting Auditors(i) Name of Accounting Auditor: KPMG AZSA LLC(ii) Fees etc. Paid to Accounting Auditors in the Fiscal Year under Review
Amount paid
A. Fees etc. pertaining to the fiscal year under review¥53 million
B. Total amount of cash and other asset-based benefits payable to the¥101 million
accounting auditors of TBS Holdings, Inc. and its subsidiaries
Note 1: The audit agreement between the Company and the accounting auditor does not separate the amounts of fees
etc. for audits under the Companies Act from the amounts of fees etc. for audits under the Financial
Instruments and Exchange Act. Since it is essentially impossible to separate these amounts, the amountshown for A. above represents the sum of both.
Note 2: The Audit & Supervisory Board consents to the fees etc. paid to the accounting auditor as stipulated under
Article 399, Paragraph 1 of the Companies Act after comparing audit plans in prior years of the accounting
auditor to actual audit results, reviewing changes in audit hours and fees for audits, and considering thereasonableness of audit hours and estimated fees in the fiscal year under review.
(iii) Policy on Determination of Dismissal or Non-Reappointment of Accounting Auditor
If there are grounds for dismissal under the provisions of Article 340, Paragraph 1 of the Companies Act, theAudit & Supervisory Board of the Company will dismiss the accounting auditor, subject to approval by all Audit& Supervisory Board Members.
In addition, when the Audit & Supervisory Board deems there is a clear need for action, such as when the Audit& Supervisory Board recognizes it would be difficult for the accounting auditor to execute their duties, it may
decide upon the content of a proposal concerning the dismissal or non-reappointment of the accounting auditor,and based on this decision, the Board of Directors may submit this as an item for approval at the general meetingof shareholders.

[English Translation]47

3. Systems Ensuring that Directors Perform their Duties in Accordance with theLaws and Regulations and the Articles of Incorporation and that Other
Operations are Conducted Appropriately
The Company adopted the “policy concerning the establishment of the systems necessary to ensure that thebusiness performance by the Directors complies with laws and the Articles of Incorporation, and other systems
necessary to ensure the properness of operations of a stock company and a corporate group consisting of the stockcompany and its subsidiaries,” as stipulated in Item 6, Paragraph 4 of Article 362 of the Companies Act andParagraphs 1 and 3 of Article 100 of the Regulation for Enforcement of the Companies Act.
Introduction
As a certified broadcast holding company, with broadcasters under its umbrella that are entrusted with the use offinite and valuable radio waves, TBS Holdings, Inc. is profoundly aware of the social responsibilities and public
mission of broadcasting, as stated in the TBS Group Activities Charter, and will continue to fulfill and strengthen its
corporate governance.
As part of our efforts to carry out our business activities appropriately and efficiently while maintaining andenhancing the corporate value of the TBS Group, we have established the TBS Group Corporate Activities
Committee to build and implement internal control systems for the Group.
The Committee is chaired by the President and made up of directors from the Company and its Group companies,
as well as outside members. Its responsibilities are as follows:
1. Matters pertaining to the development, evaluation and improvement of internal control systems
2. Matters pertaining to upholding business ethics
3. Matters pertaining to the risk management and the appropriate and efficient performance of operations
4. Matters pertaining to information disclosure system
5. Matters pertaining to questions from the Board of Directors of TBS Group companies(1) Systems Ensuring that Directors Perform their Duties in Accordance with the Laws and Regulations andthe Articles of Incorporation
(a)

(b)
(c)

(d)

All officers and employees swear a basic oath under the TBS Group Activities Charter, which defines thecorporate philosophy under which the TBS Group is working to achieve growth based on excellence as acorporate group.
We are working to ensure the full implementation of the TBS Group Activities Standards, which were
formulated as standards for the realization of the Charter.
We have formulated the TBS Group Information Disclosure Policies, and we will fulfill our responsibilities
to provide good explanations to shareholders as a corporate group through the timely disclosure of accurate
information.
The Special Committee for Appraising Corporate Value, consisting of outside directors, outside audit &supervisory board members and outside experts, assesses policies from the perspective of maximizing
corporate value in response to questions submitted by the Board of Directors, and advises the Board of
Directors of the results of its deliberations.
TBS Holdings, Inc. is audited by the Audit & Supervisory Board, formed by standing statutory audit &supervisory board members and outside audit & supervisory board members. The important subsidiary, Tokyo
Broadcasting System Television, Inc. does not set the Audit & Supervisory Board but is audited by outside
audit & supervisory board members on the basis of the structure of TBS Holdings, Inc.

(2) Systems Concerning the Storage and Management of Information Pertaining to the Performance of
Directors’ Duties(a)

We have formulated the Document Handling Regulations, which define standards for the handling of
documents containing information pertaining to the performance of directors’ duties. Documents are stored
and managed appropriately and reliably during the periods stipulated in those regulations.
(b)
We will maintain document storage and management systems capable of responding promptly to requests
from directors and audit & supervisory board members who wish to peruse documents pertaining to theperformance of directors’ duties.
48[English Translation]

(3) Risks of Loss Management Regulations and Other Systems
(a)

(b)
(c)

(d)

(e)
(f)

We will establish the TBS Group General Risk Management Policies, the TBS Group General Risk
Management Regulations, and other regulations required to support ongoing controls on risks of losses
affecting our business activities and operations, and monitor risks based on implementation guidelines. Risk
management conditions will be evaluated semi-annually by the TBS Group General Risk Management
Committee, which is a sub-committee of the TBS Group Corporate Activities Committee.
We have formulated Basic Policies for Managing Market Risk. This policy is reviewed semi-annually toensure an appropriate response to the risk of share price, foreign exchange rate and interest rate fluctuations.
We have formulated the Investment and Financial Management Regulations to support the management,
coordination and efficient use of investments and finance. The appropriateness of investments and loans is
assessed by the Investment and Financial Judging Committee after consultation with the Board of Standing
Directors and Officers.
To prepare for serious risks such as damage to our corporate brand, we have formulated the TBS Group Crisis
Response Regulations, which define the establishment of an organization in charge, operational procedures,information management approach, and other systems that differ from those in normal times, and will respondto the emergence of serious risks.
We have established the TBS Group Information Liaison Conference to summarize and share information
required to handle situations when risks arise.
We have formulated the TBS Group Information Security Policy to ensure appropriate network use andprevent threats, such as unauthorized access, system damage caused by computer viruses etc., and data leakage
or tampering etc.

(4) Systems Ensuring the Efficient Performance of Directors’ Duties
(a)
(b)
(c)

In principle, the Board of Directors meets regularly once every month. This is the basic system for ensuring
the efficient performance of directors’ duties.
Important matters pertaining to management policy and strategies are discussed at the Board of Standing
Directors and Officers, which is in principle held once a week. Decisions on executive actions are taken after
these deliberations.
The Board of Standing Directors and Officers, which advises the President, directly supports comprehensive
long-term management planning by facilitating and coordinating long-term management planning activities.

(5) Systems Ensuring that Employees Perform their Duties in Compliance with Laws and Regulations andthe Articles of Incorporation
(a)
(b)
(c)
(d)

We have formulated the TBS Group Activities Charter as a basic oath that all officers and employees are
required to uphold. We have also adopted the TBS Group Activities Standards as standards for the realizationof the Charter.
We will ensure that the Legal & Compliance Division is able to function effectively and appropriately as thecoordinating unit for the development and operation of our internal control and compliance system, and that
the Office of Internal Audit can function effectively and appropriately as the internal audit unit.
We will maintain the TBS Hotline as an internal reporting system for the Group, and we will make effective
use of the Legal & Compliance Division and outside law offices as contact points for the reporting of problems,such as situations that contravene laws and regulations or corporate rules.
We will maintain internal checks and balances, such as personnel-related systems, to eliminate theconcentration of authority in the hands of individual employees.

[English Translation]49

(6) Systems Ensuring the Appropriateness of Business Operations of the Group Consisting of TBS Holdings,
Inc. and Its Subsidiaries
(a)
(b)

(c)
(d)
(e)
(f)

We will apply the TBS Group Activities Charter and the TBS Group Activities Standards as the oath andbehavior guidelines for the Group. The Company will conduct a review of each company in the Group on aregular basis, in order to ensure strict compliance therewith.
Tokyo Broadcasting System Television, Inc., TBS Radio, Inc. and BS-TBS, INC., broadcasters under its
umbrella, will set the Broadcast Council in accordance with the Broadcasting Act, and Broadcast Council willbe the committee for consultation and proposal of all queries, aiming for the improvement and thedevelopment of broadcast programs.
The Company will set the Office of Internal Audit to conduct internal audits of all related Group companies.
Each company within the Group will lay down the TBS Group Corporate Governance, aim the penetration of
formulation and operation of internal control systems, and straighten the system to maintain the soundness ofthe parent and subsidiary relationships in the Group.
Each company within the Group will participate in the TBS Hotline and set out and operate a structure to raiseawareness of the participation.
We have formulated the Subsidiaries and Affiliates Management Regulations as the basis for ensuring theappropriateness of business operations and enhancing the management efficiency of the Group, as well as
accelerating their development through the provision of guidance, while developing a system under which
directors of subsidiaries report matters concerning the execution of duties to the Company.

(7) Systems Ensuring the Effectiveness of Audits Conducted by the Audit & Supervisory Board Members
and Systems Concerning Reports to the Audit & Supervisory Board Members
1.

Items Pertaining to Employees in the Audit & Supervisory Board Member Support Organization and theIndependence of those Employees from Directors(a) We will ensure that the Office of Audit & Supervisory Board Members is able to function as a support
unit for the activities of the audit & supervisory board members, and employees who provide that support
will assist in the work of the audit & supervisory board members pursuant to instructions from the audit& supervisory board members. We will also maintain a system whereby approval of the audit &supervisory board members will be obtained for personnel appraisals and transfers of such employees,
and for any disciplinary action against such employees.
(b) The Audit & Supervisory Board will establish an Audit & Supervisory Board Headquarters if required,such as when there are matters requiring investigation by the audit & supervisory board members.
Employees nominated by the Audit & Supervisory Board will provide assistance to the Audit &Supervisory Board or the audit & supervisory board members. The Company will appropriately bear
expenses incurred for the investigation by the Audit & Supervisory Board Headquarters.

2.

Systems for Reporting to the Audit & Supervisory Board Members by Directors and Employees and for Other
Reports to the Audit & Supervisory Board Members
(a)
(b)
(c)
(d)
(e)

The directors and employees will report to the audit & supervisory board members whenever there areimportant matters affecting operations or performance. A system will also be secured to ensure they
are not treated unfavorably based on facts reported or details thereof.
The audit & supervisory board members may require reports from directors or employees as required
at any time.
We will operate the TBS Group Information Liaison Conference and the TBS Hotline appropriately
and maintain appropriate reporting systems, so that the audit & supervisory board members can beinformed of any compliance issues, including violations of laws and regulations.
The audit & supervisory board members will receive reports on the results of internal audits conductedby the Office of Internal Audit.
The audit & supervisory board members can attend important meetings, peruse documents concerning
important decisions, and require directors to provide reports concerning the performance of operations.
If necessary, the audit & supervisory board members can also hold direct hearings in any department.

[English Translation]

50

(f)
(g)
3.

The audit & supervisory board members, accounting auditors, the Office of Internal Audit and the Legal& Compliance Division will share information to maintain effective and efficient internal control
systems.
The Company will appropriately bear expenses that arise from executing the duties of the audit &supervisory board members, respecting the will of audit & supervisory board members.

Systems under Which Directors and Employees of Subsidiaries of the Company and Directors and Employees
Who Received Reports from them Report to Audit & Supervisory Board Members and Other Systems
Concerning Reports to the Audit & Supervisory Board Members
(a)

(b)

We will secure a system at Group companies under which directors and employees report serious risks
and matters concerning internal controls to audit & supervisory board members of the Company and asystem under which audit & supervisory board members of the Company may require reports fromdirectors, audit & supervisory board members, or employees of Group companies as required at any
time.
We will secure a system to ensure that directors, audit & supervisory board members, or employees ofGroup companies who report to audit & supervisory board members and directors or employees who
receive reports from them will not be treated unfavorably based on the facts reported to audit &supervisory board members and details thereof.

[English Translation]51

4. Summary of Status of Implementation of System for Ensuring theAppropriateness of Business Operations
In accordance with a resolution adopted by the Board of Directors for a “system ensuring the appropriateness ofbusiness operations” as stipulated in Item 6, Paragraph 4 of Article 362 of the Companies Act and Paragraphs 1 and
3 of Article 100 of the Regulation for Enforcement of the Companies Act, the department in charge of internal
controls of the Company leads efforts to develop and operate internal control systems, highlighted by thedevelopment of TBS Group General Risk Management Regulations, Document Handling Regulations, and otherinternal regulations, and holds meetings of the TBS Group General Risk Management Committee and othercommittees. As part of our efforts to carry out our business activities appropriately and efficiently, while maintaining
and enhancing the corporate value of the TBS Group, we have established the TBS Group Corporate Activities
Committee, which is chaired by the President, to build and implement internal control systems for the Group.
As of the end of the fiscal year under review, the department in charge of internal controls and the Office ofInternal Audit confirmed that internal control systems of the Company are properly implemented in accordance witha resolution adopted by the Board of Directors for a “system ensuring the appropriateness of business operations”
and function effectively by perusing minutes of the Board of Directors’ meetings and other important meetings,
receiving reports from departments, and conducting interviews. Besides, matters of note on the specific status of
implementation can be listed as follows.
(1)

(2)

(3)

(4)

Among our efforts to promote risk management, we follow the process of 1. Identifying risks that impede
achieving management objectives and internal control objectives of the Company, 2. Evaluating risks
identified, 3. Identifying “core items” that could significantly affect the Company, 4. Formulating a plan torespond to “core items” to minimize risks, and 5. Confirming the progress of the plan to respond to “coreitems” based on the TBS Group General Risk Management Regulations. Specialized departments lead efforts
to formulate and implement the plan to respond to “core items,” and the TBS Group General Risk Management
Committee coordinates those efforts on a company-wide basis.
We have formulated rules to be complied with as the TBS Group based on the TBS Group Corporate
Governance, and require each company within the Group to comply with such rules for developing internal
control systems of the Group including its consolidated subsidiaries. The TBS Group General Risk
Management Committee and the department in charge of internal control check whether target companies
appropriately perform business operations in accordance with such rules and request them to make
improvements when any issue is found.
Concerning the operation of internal control systems at TBS Holdings, Inc. and its consolidated subsidiaries,
the Company established the Proper Activities Inspection Special Subcommittee, which inspects systems that
ensure the appropriateness of the Group companies’ activities, and reports to the TBS Group Corporate
Activities Committee.
Regarding internal controls performed to ensure the reliability of financial reporting, we evaluate theireffectiveness based on procedures compliant with generally accepted valuation standards as stipulated by theprovisions of the Financial Instruments and Exchange Act and other related laws and regulations, and report
its results to outside parties. The President performs this evaluation in accordance with the “regulations forevaluating the effectiveness of internal controls over financial reporting,” assisted by the Office of Internal
Audit, which reports directly to the President. The Office of Internal Audit, upon consulting with theaccounting auditor, formulates an evaluation plan, which defines the scope of evaluations and other matters,
and evaluates the status of developing and implementing internal controls. When a deficiency is found, theOffice recommends internal control managers to correct the relevant process, counts the number of
deficiencies at the year end, and reports them to the President, the Board of Directors, the audit & supervisoryboard members, and others.

[English Translation]52

5. Basic Policy Regarding Parties Deciding on Financial and Business Policies of
TBS Holdings, Inc.
The Company established the Basic Policy Regarding Parties Deciding on Financial and Business Policies of theCompany (hereinafter referred to as the “Basic Policy”) at the Board of Directors’ meeting held on February 28, 2007.
In addition, following the end of “TBS Group Medium-term Management Plan 2023,” a medium-term management
plan of the Group, on March 31, 2024, the Company plans to revise the sections of the Basic Policy that are related tothe medium-term management plan as follows at the Board of Directors’ meeting on May 14, 2024.
(1) Basic Policy
As a listed company, the Company has a responsibility to contribute to the development of market economy. We also
have an important public mission as a certified broadcast holding company, with broadcasters under our umbrella thatare entrusted with the use of finite and valuable radio waves. The corporate characteristics of the Company are
expressed as follows in the “TBS Group Activities Charter,” which was formulated by the Company. “We consistently
commit ourselves to the freedom of expression and make efforts to transmit fair, honest and accurate information,
thereby fulfilling the mission expected of a news medium” and “We place a great importance on relations with society
and harmonious coexistence with nature, and commit ourselves to a sustainable society as well as in the realization of abetter global environment.” In addition, the Company is given a vital role as a certified broadcast holding company withbroadcasters under its umbrella that are, as our country’s key media, expected to perform the function of social lifeline
particularly at the time of disasters and emergencies without any delay.
With the emergence of full-scale digital terrestrial broadcasting and the arrival of the multimedia era, the challenge
for the broadcasting industry is the improvement of program production, planning and development capabilities andprogram quality.
We recognize our work force, including the employees and associated workers of TBS Holdings, Inc. and its
subsidiaries and affiliated companies as a business resource that is vital to the fulfillment of our public mission andsocial role, and to our efforts to improve program production, planning and development capabilities and program
quality, which are key to our competitiveness as a broadcaster. Furthermore, the relationships of trust that we have built
over many years with our contractors and suppliers, and with all of the people who contribute to the development ofprograms and content, play an extremely important role as a business resource. These above all are the sources of ourcorporate value.
To maximize our corporate value and the common interests of our shareholders, we must develop and strengthen thesources of our corporate value from a medium- to long-term perspective. Decisions concerning our financial andbusiness policies need to be based on an awareness of these facts.
As a listed company, we are not opposed to a Large-Scale Acquisition of our shares if this contributes to the
maximization of our corporate value and the common interests of our shareholders. Nor are we opposed to the proposalof ideas relating to these actions. However, if decisions on our corporate financial and business policies are controlled
by parties who do not share our belief in the need to strengthen the aforementioned sources of our corporate value froma medium- to long-term perspective, there is a risk that these resources will be impaired in the medium to long term. If
so, this would compromise our efforts to maximize our corporate value and the common interests of all shareholders.
For these reasons, and in keeping with the spirit of the Broadcasting Act and the Radio Act, TBS Holdings, Inc. may,under certain circumstances, take steps to secure and maximize its corporate value and the common interests of allshareholders, within the limits allowable under the laws and regulations and the Articles of Incorporation of TBS
Holdings, Inc. We may take such steps if there is a risk that a specific party or group, or its related parties (hereinaftercollectively referred to as the “acquirer etc.,”), may damage the sources of our corporate value from a medium- to longterm perspective, for instance through the acquisition of voting rights equivalent to 20% or more of the total voting
rights in TBS Holdings, Inc., where the acquirer etc., is unsuitable as a party controlling decisions concerning thefinancial or business policies of TBS Holdings, Inc.
The certified broadcast holding company structure is intended to provide new management platforms that enablebroadcasters to further promote management efficiency in line with the purport of the principle of excluding multiple
ownerships of the media by granting broadcasters avail of the holding company structure. Under the structure, thoseshareholders with the legal voting right more than 33% are restricted from holding the portion of the voting right inexcess of 33% for the purpose of securing pluralism, diversity and regionality of broadcasting. Thus, this restriction isalready applied to the Company shareholders as the result of the Company’s shift to a certified broadcast holding
company.
Even after the shift to a certified broadcast holding company, the Company has been placing “all-around businessalliance policy” in a tie-up policy that aims at adherence to the impartiality of broadcasting and realization of optimal[English Translation]

53

tie-ups with optimal business partners in each field, thereby building all-around relationships with various business
partners as a whole. In light of this policy, however, the appearance of shareholders with a shareholding ratio
exceeding 20% still remains unfavorable for the Company’s corporate value as well as the common interest of ourshareholders unless it is expected to bring more benefit than the case where the tie-up policy above is strictly observed.
Accordingly, regardless of an application of the voting right holding restriction structure to the Company as a resultof the shift to a certified broadcast holding company system, the Company will continuously maintain its engagement
to prevent controls over the decision on the Company’s financial and business policies by inappropriate parties inlight of the Basic Policy. Furthermore, the Company plans to formulate “TBS Group Medium-term Management
Plan 2026” on May 14, 2024 as a new medium-term management plan of the Group. The Company will work on
management with the aim of further strengthen capital efficiency based on this plan.
(2) Raising Corporate Value and Maximizing the Common Interests of Shareholders by Formulating and
Implementing the “TBS Group Medium-term Management Plan 2026”
Since its establishment, the Group has been striving to enhance its corporate value by serving the public’s right toknow through television and radio broadcasting, and by providing high-quality entertainment that will appeal to awide range of audiences. However, the recent business environment surrounding the Company has changed rapidly
due to the declining birthrate, aging population, diversification of lifestyles, digitalization, and other factors. In
addition, in recent years, the Company has experienced international political instability and the spread of infectious
diseases on a global scale, and the business environment continues to be difficult to predict. Recognizing that thegreatest challenge for the Group is to sustainably increase its corporate value as a company that is sought after bysociety, even in this environment, the Company formulated “TBS Group VISION 2030” in May 2021, as our future
vision from a long-term perspective. As part of formulating the vision, the Group defined content as all that “moves
people’s hearts and minds,” and expressed its vision of becoming a content group that goes beyond the boundaries
of broadcasting to capture “each ‘moment’” by focusing on the Group’s greatest strength, its ability to create content.
Therefore, in May 2024, the Company will formulate the second phase of VISION 2030, the “TBS Group Mediumterm Management Plan 2026.” Through the formulation and implementation of “TBS Group Medium-termManagement Plan 2026,” the Company will work on management with the aim of further strengthening capitalefficiency, endeavor to maximize the corporate value of the Company and the Group and common interests ofshareholders, and fulfill their expectations.
(3) Outline of Approaches to Prohibiting Control by Inappropriate Parties in Light of Basic Policy
In accordance with a resolution adopted by the Board of Directors on February 28, 2007, the Company has made theamendments to its policy for responding to takeover proposals, which was announced on May 18, 2005. We haveretained the essence of the plan, which is intended to secure and improve our corporate value and the common interestsof all shareholders, while making the changes to place an even greater emphasis on the wishes of shareholders (theamended policy hereinafter will be referred to as the “Plan”). The Plan and its continuation were approved at the 80th
Ordinary General Meeting of Shareholders held on June 28, 2007 (hereinafter referred to as the “resolution approved atthe 2007 shareholders’ meeting”) by a majority vote of the shareholders present who may exercise their right to vote.
Subsequently, the Plan was partially amended, within the necessary and minimum scope, within a frame of theresolution approved at the 2007 shareholders’ meeting with the prior and unanimous approval of all incumbent membersof the Special Committee for Appraising Corporate Value (hereinafter referred to as the “Special Committee”). As
described above, the amendment was in line with the Company’s shift to a certified broadcast holding company as ofApril 1, 2009 and such changes in the legal environment as the amendment and enforcement of the Companies Act andthe Financial Instruments and Exchange Act. Furthermore, with approval by consent of a majority of the incumbent
members and a majority of the outside expert members of the Special Committee as of March 4, 2021, the compositionof the Special Committee and the requirements regarding conflicts of interest of its members were changed within theframe of the resolution approved at the 2007 shareholders’ meeting, resolved by the Board of Directors’ meeting of theCompany held on the same day. Details of the Plan are as indicated below. It is partially simplified/rationalized tosecure the understandability of descriptions as in a business report.

[English Translation]54

1. Plan Details(a) Procedures for Triggering the Plan(i) Acts Subject to the Plan
The Plan is applied when an act that falls under any item from I. to III. below (hereinafter referred to as “LargeScale Acquisition”) is implemented and the Plan procedures shall be initiated when a party emerges that maintains
a policy of conducting such act (including a party that the Company’s Board of Directors reasonably determines as
having such policy based on the recommendations of the Special Committee, but excluding cases in which the Boardof Directors has given a prior approval).
The details of the countermeasures against a Large-Scale Acquisition are as set out in (iv) below. The
countermeasures under the Plan shall not be triggered as a matter of course when a party as described above emerges,
and the decision to trigger the countermeasures against such party shall be determined in strict accordance with theprocedures in (ii), (iii) and (v) to (vii) below.
I.

A tender offer intended to result in the holding ratio of share certificates, etc. of the tender offeror group
amounting to a total of 20% or more of the share certificates, etc. issued by the Company after the acquisition;II.

An acquisition, etc. that would result in the owning ratio of share certificates, etc. of a Large-Scale Acquisitiongroup amounting to 20% or more of the share certificates, etc. issued by the Company after the acquisition;

III.

Notwithstanding the implementation by the Company of a tender offer or other acquisition of share certificates,etc. issued by the Company, a) an agreement or other act made or conducted between the Large-Scale
Acquisition group and another shareholder of the Company whose total owning ratio of share certificates, etc.
together with the Large-Scale Acquisition group is 20% or more of the total ownership in the Company’s sharecertificates, and results in such other shareholder becoming a joint holder of such Large-Scale Acquisitiongroup, or b) an act that establishes a relationship between the Company’s core shareholders in the Large-Scale
Acquisition group and other shareholders where one party has substantial control over the other party, or that
leads to the parties taking joint or collaborative action.

The tender offeror group, the Large-Scale Acquisition group and the other shareholders in III. above, shall becollectively referred to as the “Acquirer Group.”(ii) Request etc. of Information from the Acquirer Group
Unless the Company’s Board of Directors determines otherwise, the Acquirer Group shall, before thecommencement or implementation of the Large-Scale Acquisition, submit a written document with the information
set out in the items below (hereinafter referred to as “Necessary Information”) to the Company, and if during theBoard of Directors Evaluation Period (as defined in (iii) below) or as a result of the evaluation period, the Company’s
Board of Directors resolves to convene a General Meeting of Shareholders pursuant to (vi) below, a written document
stating that the Company’s share certificates may not be purchased during the waiting period of 21 days following
such point of time (“Waiting Period”), and a covenant pledging its compliance with the Plan procedures.
If the Special Committee finds the submitted information insufficient as Necessary Information, it may request
the Acquirer Group to provide additional information by a suitable reply deadline (as a general rule, 60 days).
I.

A Summary of the Acquirer GroupII.

The purpose, method and details of the Large-Scale Acquisition

III.

Whether or not there was communication of intent between a third party in regards to the Large-Scale
Acquisition and if the communication of intent occurred, the name of the other party, a brief description of theparty, the specific manner in which the intent was communicated and the details thereofIV.

The basis for the calculation of the consideration for the Large-Scale Acquisition and the process of calculationV.

The underlying funds for the Large-Scale Acquisition

VI.

The Company and the Group’s management policy, business plan, financial plan, funding plan, investment
plan, capital and dividend policies, and program scheduling policy planned for after the Large-Scale
Acquisition is conducted, and other policies dealing with the treatment of the Company and the Group’s[English Translation]

55

officers, employees, clients, customers, business collaborators and other interested parties of the Company and
the Group after the completion of the Large-Scale Acquisition
VII. Existence of connections with antisocial powers or terrorist organizations and policies for dealing with such
VIII. The Company’s approach to fulfilling its public mission as a certified broadcast holding company and Tokyo
Broadcasting System Television, Inc. as a broadcaster
IX.

Other information that the Company’s Board of Directors or the Special Committee reasonably deems
necessary(iii) Consideration by the Board of Directors and the Special Committee
The Company’s Board of Directors and the Special Committee shall stipulate either I. or II. stated below thatcomplies with the details of the Large-Scale Acquisition disclosed by the Acquirer Group, as the period for theCompany’s Board of Directors to evaluate, consider, form an opinion, devise an alternative proposal and negotiatewith the Acquirer Group (hereinafter referred to as the “Board of Directors Evaluation Period”).
I.

If all the Company’s share certificates, etc. are acquired through a tender offer where the consideration is only
in cash (yen): 60 daysII.

If a Large-Scale Acquisition other than I. above is conducted: 90 days

The Company’s Board of Directors shall, within the Board of Directors Evaluation Period, evaluate, consider,form an opinion, devise an alternative proposal and negotiate with the Acquirer Group with respect to a Large-Scale
Acquisition proposed by the Acquirer Group based on the Necessary Information provided by the Acquirer Group
with a view to maximizing the corporate value of the Company and the common interests of the shareholders.
At that time, the Special Committee shall also evaluate and consider the Acquirer Group’s proposal and may
obtain advice from third-party professionals independent from the Company’s Board of Directors during such
evaluation and consideration as necessary, and the expenses shall be borne by the Company.
The Special Committee may, when it acknowledges that the Acquirer Group has initiated the Large-Scale
Acquisition without complying with the Plan procedures herein, recommend for the Company’s Board of Directors
to trigger the required countermeasures provided in (iv) below, such as the gratis allotment of the Stock Acquisition
Rights, except in unusual situations where further consultations and negotiations with the Acquirer Group are
required in order to obtain the Necessary Information. In such case, the Company’s Board of Directors shall trigger
the required countermeasures in (iv) below, such as the gratis allotment of the Stock Acquisition Rights, with theutmost respect to the Special Committee’s aforementioned recommendation, except in unusual situations where thedirector has obviously breached the duty of care as a good manager.
(iv) Specific Details of the Countermeasure
The countermeasures against the Large-Scale Acquisition to be triggered by the Company in accordance with thePlan shall be, as a general rule, a gratis allotment of the Stock Acquisition Rights. Provided, however, that if it isdetermined that the triggering of other countermeasures granted under the Companies Act, other laws and regulations,or the Company’s Articles of Incorporation are appropriate, such countermeasures shall be triggered instead.
A summary regarding the gratis allotment of the Stock Acquisition Rights as a countermeasure against the LargeScale Acquisition is as set out in “3. Outline of Gratis Allotment of Stock Acquisition Rights” below, but for theactual gratis allotment of the Stock Acquisition Rights to take place the following, as well as the exercise period,
exercise terms and acquisition terms etc., in view of its effectiveness as a countermeasure for the Large-Scale
Acquisition, shall be included:
I.
II.

Terms that prohibit the Exceptional Party (defined in (c) of “3. Outline of Gratis Allotment of Stock Acquisition
Rights” below) from exercising their Stock Acquisition Rights;
Acquisition provisions which provide that the Company may acquire the Stock Acquisition Rights throughvarious considerations depending on whether or not the Stock Acquisition Rights holder is an Exceptional
Party (provisions that provide that the Stock Acquisition Rights held by a Stock Acquisition Rights holder who
is not an Exceptional Party shall be acquired by the Company in exchange for shares of common stock, and if
the Company deems it appropriate, a Stock Acquisition Rights holder who is an Exceptional Party, may acquire
new stock acquisition rights and other assets as a replacement for the Stock Acquisition Rights); or[English Translation]

56

III.

Acquisition provisions which provide that when acquiring a part of the Stock Acquisition Rights, the Company
may only acquire the Stock Acquisition Rights held by a Stock Acquisition Rights holder who is not an
Exceptional Party.

(v) Recommendation to Non-trigger the Countermeasures
Regardless of whether or not the Board of Directors Evaluation Period is complete, the Special Committee shallmake a recommendation to the Company’s Board of Directors that the countermeasure of a gratis allotment of theStock Acquisition Rights should not be triggered if the Special Committee determines that the Acquirer Group is not,overall, an abusive acquirer in accordance with the Company’s guidelines after considering the Acquirer Group’s
Large-Scale Acquisition and the acquisition proposal details, as a result of consulting or negotiating with such group,and the incumbent members of the Special Committee reaching a unanimous decision.
If the Special Committee recommends to non-trigger the gratis allotment of Stock Acquisition Rights and othercountermeasures, the Company’s Board of Directors shall follow such recommendation and resolve not to trigger
the gratis allotment of Stock Acquisition Rights and other countermeasures in accordance with the recommendation
except in an unusual situation where the director has obviously breached the duty of care as a good manager.
(vi) Convocation of a General Meeting of Shareholders
If, after exploring the Acquirer Group’s Large-Scale Acquisition and its proposal and as a result of consultations
and negotiations with the Acquirer Group, the Special Committee cannot reach a unanimous decision by theincumbent Special Committee members to make the recommendation in (v) above, the Special Committee shallrecommend for the Company’s Board of Directors to seek the judgment of a General Meeting of Shareholders inorder to determine whether to make a gratis allotment of the Stock Acquisition Rights, trigger the acquisition
provision and other countermeasures. In such case, the Company’s Board of Directors shall promptly carry out
convocation procedures for a General Meeting of Shareholders at which the agenda items shall be to seek approval
regarding the gratis allotment of Stock Acquisition Rights, and triggering of the acquisition provision and othercountermeasures.
The resolution of the General Meeting of Shareholders shall be adopted by a majority vote of the shareholders
present who may exercise their right to vote. The result of the General Meeting of Shareholders shall be disclosed
promptly after such resolution is made.
(vii) Resolution of the Board of Directors
The Company’s Board of Directors shall make a resolution regarding the gratis allotment of Stock Acquisition
Rights, the triggering of the acquisition provision, and the triggering or non-triggering of other countermeasures
without delay, as an entity under the Companies Act, by following the prescribed Plan procedures and paying theutmost respect to the Special Committee’s recommendations (recommendations regarding the triggering of thecountermeasures pursuant to (iii) above, or the non-triggering of countermeasures pursuant to (v) above), or inaccordance with the above resolution of the General Meeting of Shareholders, except in an unusual situation wherea director has obviously breached the duty of care as a good manager.
The Acquirer Group shall not conduct the Large-Scale Acquisition unless the Company’s Board of Directors has
resolved not to trigger the gratis allotment of Stock Acquisition Rights or other such countermeasures by following
the prescribed Plan procedures.
(b) The Plan’s Effective Period, Abolition and Changes
The Plan will automatically renew for a successive period of three years unless a resolution is passed to abolishthe Plan at the Company’s Ordinary General Meeting of Shareholders held every three years after the resolution
approved at the 2007 shareholders’ meeting.
However, if a resolution is made by the Company’s Board of Directors or at the Company’s General Meeting of
Shareholders to abolish the Plan or the Special Committee unanimously resolves to abolish the Plan, the Plan shallbe abolished at that point, even during the effective period.
The Plan may also be modified or changed prior to the expiration of the effective period by the Company’s Boardof Directors to the extent approved by the General Meeting of Shareholders subject to the approval of a majority of
the incumbent members and a majority of the outside expert members of the Special Committee.
2. Outline of the Company’s Special Committee for Appraising Corporate Value
The Company’s Special Committee for Appraising Corporate Value is an outside advisory body separate fromthe Board of Directors that will consider the adequacy of measures for matters such as those inquired about by the[English Translation]

57

Company’s Board of Directors based on the Plan and other such matters in determining whether such items will
maximize the Company’s corporate value, and give recommendations based upon the results. The Company’s Boardof Directors will respect the Special Committee’s recommendation to the utmost degree and make final decisions on
preliminary responses based on the response policy and matters that are necessary to the countermeasures. The
Company’s Audit & Supervisory Board shall supervise the Board of Directors’ and the Special Committee’s
decision-making process.
The Special Committee shall consist of outside members including: (1) one to three of the Company’s or Tokyo
Broadcasting System Television Inc.’s outside directors; (2) one to two of the Company’s or Tokyo Broadcasting
System Television Inc.’s outside audit & supervisory board members, and (3) one to three experts from outside theCompany with achievements as attorneys-at-law, public accountants, persons experienced in investment banking
companies, management, and experienced scholars knowledgeable about the Companies Act. (However, all theseparties shall have no interest in the Acquirer Group that is the target of the preliminary responses or countermeasures.)
The term of office for each committee member shall be two years.
3. Outline of Gratis Allotment of Stock Acquisition Rights(a) Entitled Shareholders
The Company will make a gratis allotment of stock acquisition rights to the shareholders whose names are enteredor recorded in the last register of shareholders on the record date determined by the Company’s Board of Directors(the date immediately following the occurrence of the acts subject to the Plan as set out in the body of (a) (i) of “1.
Plan Details” above), for one stock acquisition right per share in the Company held by those shareholders (excluding
shares of common stock held by the Company).
(b) Class and Number of Shares to be Issued upon Exercise of Stock Acquisition Rights
The class of shares to be issued upon exercise of stock acquisition rights will be shares of common stock in the
Company and the number of shares to be issued upon exercise will be one share or a fraction of one share of common
stocks in the Company as determined by the Company’s Board of Directors.
(c) Conditions for Exercise of Stock Acquisition Rights
The Company’s Board of Directors will determine the conditions for exercise of stock acquisition rights. (TheCompany may attach a condition for exercise that the Company will not allow an exercise of the rights by any party
it designates pursuant to the procedures prescribed by the Board of Directors as a party who belongs to an Acquirer
Group (hereinafter referred to as the “Exceptional Party”)).
(d) Acquisition of Stock Acquisition Rights by the Company(i) The Company may establish, by resolution of its Board of Directors, an acquisition clause allowing only an
acquisition of (x) all stock acquisition rights or (y) the stock acquisition rights owned by stock acquisitionrights holders other than the Exceptional Party upon the occurrence of certain events or the arrival of certain
dates that are determined by the Board of Directors.
(ii) If the Company establishes an acquisition clause set out in (i) above and acquires stock acquisition rightsfrom a stock acquisition rights holder other than the Exceptional Party, the Company will, in exchange forone stock acquisition right, deliver to the stock acquisition rights holder the number of shares of common
stock in the Company to be predetermined by the Board of Directors as one share or a fraction of one share.
Also, if the Company acquires stock acquisition rights from a stock acquisition rights holder who is the
Exceptional Party, the Company may, in exchange for one stock acquisition right, deliver to the stockacquisition rights holder new stock acquisition rights issued in place of the existing stock acquisition rights
or other property.
(iii) If, as a result of acquiring the stock acquisition rights pursuant to the acquisition clause set out in (i) above,
foreign shareholders that do not fall under the Exceptional Party will hold 20% or more of the total voting
rights of the Company, for those shares of common stock to be issued to those foreign shareholders as
consideration for acquisitions that will compose 20% or more of the total voting rights of the Company, theCompany will, in exchange for one stock acquisition right, deliver new stock acquisition rights or otherproperty in place of the existing stock acquisition right, both in proportion to the holding ratio of each suchforeign shareholders.

[English Translation]

58

4. Impact on Shareholders, etc.
(a) Impact of renewal of the Plan on shareholders and investors
Since the Stock Acquisition Rights will not be issued at the renewal of the Plan, the rights of shareholders andinvestors will not be affected.
(b) Impact on shareholders and investors during the Board of Directors Evaluation Period
In the preliminary response during the Board of Directors Evaluation Period, the Company will disclose to theshareholders and investors as appropriate and to the extent necessary the materials, etc. provided by the Acquirer
Group or collected by the Company, as well as our opinions and judgments based on such materials, etc. In addition,
we will present an alternative proposal, if any. The Company considers the preliminary response as an important
opportunity to disclose information necessary for shareholders and investors to make decisions.
(c) Impact on shareholders and investors due to gratis allotment of Stock Acquisition Rights
Under the structure of countermeasures envisioned in the Plan, at the time of gratis allotment of Stock Acquisition
Rights, there will be a dilution of the value per share of the Company’s stocks held by shareholders, but there will
be no dilution of the value of our stocks held as a whole. Therefore, we do not expect any direct or specific impact
on the legal rights and economic interests of shareholders and investors. However, there is a possibility that the legal
rights and economic interests of the Exceptional Party could be affected as a result of the triggering ofcountermeasures.
When triggering the countermeasures under the Plan, the Company will disclose the information in a timely andappropriate manner in accordance with the relevant laws and regulations and the rules of the relevant financial
instruments exchanges, and will give sufficient consideration and take appropriate measures to prevent any
unforeseen damage or disadvantage to our shareholders and investors. In addition, after the resolution of the gratis
allocation of Stock Acquisition Rights as a countermeasure and the ex-rights pertaining to the gratis allocation of
Stock Acquisition Rights, the Company will not cancel the gratis allocation of Stock Acquisition Rights or acquire
the Stock Acquisition Rights allocated without contribution in order to avoid any unforeseen damage or disadvantage
to our shareholders and investors.

(4) Positions of the Board of Directors Concerning Specific Initiatives, and Reasons for Those Positions
The Plan aimed at ensuring and improving both the Company’s corporate value and the common interests ofshareholders and based on the policy for responding to takeover proposals, adopted at the Board of Directors’
meeting held on May 18, 2005, was repositioned and partially amended at the Board of Directors’ meeting held on
February 28, 2007 to prohibit inappropriate parties in light of the basic policy from controlling the decisions on the
Company’s financial and business policies, and approved by the resolution approved at the 2007 shareholders’meeting. The partial amendment was made of the Board of Directors on April 3, 2009 within the necessary andminimum scope, which we assessed that the amendment made was within the resolution approved at the 2007
shareholders’ meeting.
The response policy after the revision (the “Plan”) was developed, adheres to the corporate legal systems such as
the Companies Act, the “Guidelines Regarding Takeover Defense for the Purposes of Protection and Enhancementof Corporate Value and Shareholders’ Common Interests” jointly released by the Ministry of Economy, Trade andIndustry and the Ministry of Justice on May 27, 2005 (the “Government Guidelines”), the “Partially Revised Listing
Examination Criteria for Share Certificates Following an Overhaul of the Listing System Pertaining to theIntroduction of Takeover Defense Policies” released by Tokyo Stock Exchange Inc. on March 7, 2006, and various
Tokyo Stock Exchange Inc. rules, with sufficient regard to the shareholder’s rights, the exercise thereof, and theCompany shares’ impact on the stock markets on which the Company’s shares are listed, and a General Meeting of
Shareholders will be convened as a general rule to allow direct canvassing of the wishes of shareholders before thecountermeasures are triggered, and to ensure fairness and objectivity, a Special Committee for Appraising Corporate
Value, consisting of highly independent outside directors, outside audit & supervisory board members and outside
experts, shall give advice about triggering or not triggering the countermeasures, and such advice shall be followed
to the greatest possible extent, and the Plan can be terminated by a single resolution of a General Meeting of
Shareholders. Accordingly, the amended policy is seen as contributing to our corporate value and the common
interests of shareholders and not as a policy designed to maintain the positions of officers of the Company.

[English Translation]

59

Consolidated Financial Statements
Consolidated Balance Sheets
Accounting ItemASSETS
Current assets:

As of March 31, 2024

154,399

Cash and deposits

43,718Notes and accounts receivable trade, and contract assets
Securities
Inventories
Prepaid expenses
Other74,37520
19,201
11,115
6,158

Allowance for doubtful accounts(190)

Non-current assets:(Millions of yen)

97th Business
Term

Accounting Item
LIABILITIESCurrent liabilities:
Notes and accounts payable - trade
Current portion of long-termborrowings
Accounts payable - other
Income taxes payable
Accrued consumption taxes
Accrued expenses
Provision for bonuses
Provision for bonuses for directors(and other officers)
Other

1,413,105

As of March 31, 2024

94,993
44,914400
17,875
10,692
2,550
2,011
4,571
19
11,957

Property, plant and equipment:

264,159

Buildings and structures
Machinery, equipment andvehiclesTools, furniture and fixtures
Land
Leased assets
Construction in progress

84,271Long-term borrowings

3,383

7,650
3,312
165,808
144
2,972

Retirement benefit liability
Provision for share awards
Lease liabilities
Deferred tax liabilities
Other
Total liabilities
NET ASSETS
Shareholders’ equity:

15,0883,497
102
283,578
16,913
417,557

Intangible assets:

53,033

Software
Goodwill
Other

7,056
22,79423,183

Investments and other assets:
Investment securities

1,095,912
1,083,289

Long-term loans receivable
Deferred tax assets

17
2,124

Long-term prepaid expenses
Other

260
10,295

Allowance for doubtful accounts

Total assets[English Translation](75)

1,567,504

Non-current liabilities:

97th Business
Term

Share capital
Capital surplus
Retained earnings
Treasury shares
Accumulated other comprehensive
income:Valuation difference on availablefor-sale securities
Deferred gains or losses on hedges
Foreign currency translation
adjustment
Remeasurements of defined benefit
plans
Non-controlling interests
Total net assets
Total liabilities and net assets

60

322,564

488,696
54,98634,257
416,582(17,129)
648,962
647,81224
311
813
12,287
1,149,947
1,567,504

Consolidated Statements of Income(Millions of yen)

97th Business Term

Accounting Item

From April 1, 2023 to March 31, 2024

Net sales

394,309

Cost of sales

273,889

Gross profit

120,420

Selling, general and administrative expenses

105,244

Operating profit

15,175Non-operating income

13,641

Interest income

13

Dividend income

12,003

Share of profit of entities accounted for using equity method

1,221

Other

402

Non-operating expenses

1,163Interest expenses

29

Non-deductible consumption tax, etc.

266

Loss on retirement of non-current assets

178

Other

689

Ordinary profit

27,653Extraordinary income

34,911Gain on sale of investment securities

34,911

Extraordinary losses

4,844

Retirement benefit expenses

3,257

Restructuring-related expenses

859

Removal expenses of non-current assets

427

Business restructuring expenses

218

Loss on sale of investment securities

52

Impairment losses

14

Loss on valuation of investment securities

14

Profit before income taxes

57,719

Income taxes - current

20,657

Income taxes - deferred(2,403)

Profit39,465

Profit attributable to non-controlling interests

1,339

Profit attributable to owners of parent

38,126[English Translation]

61

Consolidated Statements of Changes in Equity(Fiscal Year from April 1, 2023 to March 31, 2024)(Millions of yen)

Shareholders’ equity

Balance at beginning of period
Changes during period
Dividends of surplus
Profit attributable to owners ofparentPurchase of treasury shares
Disposal of treasury shares
Cancellation of treasury shares
Change in treasury shares arisingfrom change in equity in entities
accounted for using equity
methodChange in ownership interest ofparent due to transactions with
non-controlling interests
Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period

Capital stock

Capital surplus

54,98642,547Retainedearnings
385,868

Treasury shares(11,354)

Total
shareholders’equity472,047(7,412)
38,126135(5,601)(7,412)(11,716)
339
5,601

38,126(11,716)
475
–

0

0

(2,824)–(8,290)34,25754,986(2,824)30,714
416,582(5,775)(17,129)

16,648488,696

Accumulated other comprehensive income

Balance at beginning of period
Changes during period
Dividends of surplus
Profit attributable to owners ofparentPurchase of treasury shares
Disposal of treasury shares
Cancellation of treasury shares
Change in treasury shares arisingfrom change in equity in entities
accounted for using equity
methodChange in ownership interest ofparent due to transactions with
non-controlling interests
Net changes in items other thanshareholders’ equity
Total changes during period
Balance at end of period[English Translation]

Valuationdifferenceonavailablefor-salesecurities
308,393

Deferred
gains orlosses onhedgesForeigncurrencytranslation
adjustment

10

168

Total
Remeasure
Nonments of accumulated controllingotherdefinedinterests
comprehensi
benefitve incomeplans
47

308,619

15,517

Total net
assets796,184(7,412)
38,126(11,716)475–
0(2,824)339,419

14

142

766

340,343(3,229)337,114

339,419
647,812

14
24

142
311

766
813

340,343648,962(3,229)12,287353,763
1,149,947

62

Notes to Consolidated Financial Statements
Basis of Preparing Consolidated Financial Statements
1. Scope of Consolidation(1) Consolidated subsidiaries
Number of consolidated subsidiaries:
26
Names of principal consolidated subsidiaries
Principal subsidiaries are as listed in Business Report “Principal Subsidiaries.”
YARUKI Switch Group Holdings Co., Ltd. and its subsidiaries and associates, YARUKI Switch Group
Co., Ltd., YARUKI Switch Careers Co., Ltd., and YP Switch Co., Ltd. were included in the scope of
consolidation effective from the fiscal year under review due to the acquisition of shares of YARUKI
Switch Group Holdings Co., Ltd.
(2) Non-consolidated subsidiaries
Name of principal non-consolidated subsidiary:
Telepac Co. Ltd.
The 20 non-consolidated subsidiaries are all minor in terms of various items, including
total assets, net sales, profit/loss (based on the Company’s share interest) and retained
earnings (based on the Company’s share interest), and their overall effect on the
Company’s consolidated financial statements is minimal.
2. Application of Equity Method(1) Affiliated companies to which equity method is applied
Number of companies: 7
Name of principal equity-method affiliated company WOWOW Inc. and U-NEXT Co., Ltd.
U-NEXT Co., Ltd. was included in the scope of application of the equity method
effective from the fiscal year under review due to acquisition of its shares. In addition,
YGC Co., Ltd., an affiliated company of YARUKI Switch Group Holdings Co., Ltd.,was included in the scope of application of the equity method effective from the fiscal
year under review due to the acquisition of shares of YARUKI Switch Group Holdings
Co., Ltd. Furthermore, Taiwan Tact Education Co., Ltd. was included in the scope of
application of the equity method effective from the fiscal year under review due toadditional acquisition of its shares by YARUKI Switch Group Holdings Co., Ltd.
(2) Affiliated companies to which equity method is not applied
Name of principal non-equity-method company:
Kids Station Inc.
The 20 non-consolidated subsidiaries and 28 affiliated companies are all minor in terms
of profit/loss (based on the Company’s share interest) and retained earnings (based on
the Company’s share interest), and have minimal effect on the Company’s consolidated
financial statements. Because of their limited overall significance, the equity method has
not been applied and the companies have instead been valued at cost.
3. Fiscal Year Ends of Consolidated Subsidiaries
Tokyo Broadcasting System International, Inc. had fiscal year that ended on December 31. YARUKI
Switch Group Holdings Co., Ltd., YARUKI Switch Group Co., Ltd., YARUKI Switch Careers Co., Ltd.,and YP Switch Co., Ltd. had fiscal years that ended on February 29. The consolidated financial
statements were prepared using its financial statements as of its term-end and have been adjusted toreflect important transactions that took place between the term-end of the company and March 31, 2023.
4. Notes on Accounting Policies(1) Basis and method of valuation of major assets
a. Basis and method of valuation of securities
Held-to-maturity securities: Amortized cost method (straight line)
Shares of subsidiaries and affiliated companies: At cost, using the moving average method[English Translation]

63

Available-for-sale securities:
Securities other than shares without a market price, etc.: At market value (Net unrealized
gains/losses are shown in net assets. Realized gains/losses are calculated using the moving
average method.)
Shares without a market price, etc.: At cost based on the moving average method
b. Basis and method of valuation of inventories
Merchandise and finished goods:
Mainly at cost, using the moving average or total average method (book value written down basedon decline in profitability)
Programs and work in progress:
Mainly at cost, using the identified cost method (book value written down based on decline inprofitability)
Raw materials and supplies:
Mainly at cost, using the moving average or total average method (book value written down basedon decline in profitability)(2) Method of depreciation of major depreciable assets
Property, plant and equipment (excluding leased assets)
Buildings
Straight-line method
Structures
Straight-line method (However, declining balance method is adopted forstructures acquired on or before March 31, 2016.)
Other
Declining balance method
Intangible assets (excluding leased assets)
Straight-line method: Software (items used in-house) is amortized using the straight-line method overthe estimated useful life of the item (five years).
Leased assets
Leased assets under finance leases that transfer ownership
Depreciated based on the same depreciation method as is applied to our own non-current assets.
Leased assets under finance leases that do not transfer ownership
Depreciated using the straight-line method over the lease period with no residual value.
Long-term prepaid expenses
Amortized using the straight-line method(3) Accounting policies for major provisions
a. Allowance for doubtful accounts
To provide against losses on defaults of notes and accounts receivable - trade and loans receivable,
the Company provides the allowance for doubtful accounts based on a historical experience forgeneral claims and on an estimate of collectability of specific doubtful receivables from customers
in financial difficulties.
b. Provision for bonuses
To provide for the payment of bonuses to employees, the Company provides the amount accrued at
the end of the current fiscal year out of the amount of bonuses expected to be paid.
c. Provision for bonuses for directors (and other officers)
The Company provides a provision for bonus payments to directors and audit & supervisory board
members based on the amount estimated at the end of the fiscal year.
d. Provision for share awards:
To provide for the delivery of the Company’s shares to the Group’s directors and audit &supervisory board members as well as employees, the Company provides a provision based on theestimated share award obligation.
(4) Accounting policies for significant revenue and expenses
The Group recognizes revenue using the following five-step approach.
Step 1: Identifying the contract with a customer
Step 2: Identifying the performance obligations under the contract
Step 3: Calculating the transaction price
Step 4: Allocating the transaction price to the performance obligations under the contract
Step 5: Recognizing the revenue when the relevant company has satisfied the performance obligations[English Translation]

64

The details of the main performance obligations stemming from the primary businesses that generate revenue
from contracts with the Group’s clients and normal timing for satisfying those performance obligations(normal timing for recognizing the revenue) are as follows.
The Group mainly engages in the broadcasting-related business and the retailing business. In the
broadcasting-related business, the Company broadcast programs and advertisements primarily for viewers
and listeners. The performance obligations are judged to be satisfied upon broadcasting programs andadvertisements; therefore, revenue is recognized upon said point in time. In the retailing business, theCompany has judged that the performance obligations are satisfied when merchandise and finished goods
are delivered and the customer acquires control over said merchandise and finished goods; therefore, revenue
is recognized upon delivery of merchandise and finished goods. However, for wholesale and mail order sales
via the Internet, the period from the shipment to the time when control over merchandise and finished goods
are transferred to the customer is normal, and therefore the revenue is recognized upon shipment.
Furthermore, for revenue, the estimated amount of rebates and similar items are deducted from thecompensation stipulated in contracts with customers, and only revenue from items highly unlikely to suffer
significant impairment are recognized. As for the sales of merchandise and finished goods in which theGroup falls under the category of agent of when providing goods or services to customers, the net amountafter deducting payments to other related parties from the relevant total compensation is recognized asrevenue.
(5) Standards for foreign currency translation of important foreign currency-denominated assets or liabilities
All monetary receivables and payables denominated in foreign currencies are translated into Japanese yenat the spot exchange rates as of the consolidated balance sheets date with translation differences recorded as
profit or loss. Assets, liabilities, revenue and expenses of overseas subsidiaries are translated into Japanese
yen at the spot exchange rate with translation adjustments included in foreign currency translation
adjustment under net assets.
(6) Other significant items for preparing consolidated financial statementsa. Accounting treatment for retirement benefits
To provide for retirement and severance payments to employees, retirement benefit liability is accounted
for based on the estimated amount at the end of the fiscal year and the difference between benefit
obligations and fair value of pension assets is recognized. In calculating the retirement benefit
obligations, the Company has mainly adopted the straight-line basis while some subsidiaries haveadopted benefit formula basis as a method of attributing the estimated amount to the period up to thefiscal year under review. Prior service cost is mainly amortized starting at the time of occurrence of suchcost, and actuarial gains and losses are mainly amortized starting from the following fiscal year after
the period in which such cost is incurred.
Unrecognized actuarial gains and losses and unrecognized prior service cost are recorded after adjustingtax effects in remeasurements of defined benefit plans in accumulated other comprehensive income
under net assets.
b. Amortization of goodwill
Goodwill is amortized on a straight-line basis within 20 years from the year of acquisition. However
insignificant goodwill is charged or credited to profit in the year of acquisition.
Notes on Consolidated Balance Sheets
1. Inventories
Merchandise and finished goods:
Programs and work in progress:
Raw materials and supplies:¥9,300 million¥9,052 million¥848 million

2. Accumulated Depreciation of Property, Plant and Equipment
Accumulated depreciation includes accumulated impairment loss.
3. Guarantee Liabilities
Employees’ housing loans[English Translation]¥223,242 million¥272 million
65

4. Amount Deducted From Acquisition Prices of Property, Plant andEquipment for State Subsidies Etc. Received¥1,742 million

Notes on Consolidated Statements of Changes in Equity
1. Class and Total Numbers of Shares Issued, and Class and Numbers of Treasury Shares(Shares)Number of Sharesat the Beginningof Fiscal Year
Under Review

Increase During
Fiscal Year Under
Review

Decrease During
Fiscal Year Under
Review

Number of Shares at
the End of Fiscal
Year Under Review

Common Stock (Note1)

171,591,065–

3,000,000

168,591,065

Total

171,591,065–

3,000,000

168,591,065

Common Stock (Notes
2, 3, 4)

6,435,939

3,718,548

3,190,660

6,963,827

Total

6,435,939

3,718,548

3,190,660

6,963,827

Numbers of Shares
IssuedTreasury shares

Note 1:
Note 2:
Note 3:Note 4:

A decrease of 3,000,000 issued shares of common stock was due to the cancellation of 3,000,000 treasury
shares.
The number of treasury shares at the end of the fiscal year under review includes 3,437,230 shares of theCompany held by the Stock-Granting ESOP (Employee Stock Ownership Plan) Trust and 62,500 sharesof the Company held by the Share Grant Trust Account for Directors.
An increase of 3,718,548 treasury shares of common stock was due to the purchase of 3,363,800 treasury
shares by the resolution of the Board of Directors, the purchase of 279,900 treasury shares by the StockGranting ESOP Trust, the purchase of 62,500 treasury shares by the Share Grant Trust Account for
Directors, the purchase of 11,120 shares from retirees with restricted share-based incentives for the
Employees’ Shareholding Association, and the purchase of 1,228 shares as less-than-one-unit shares.
A decrease of 3,190,660 treasury shares of common stock was due to the cancellation of 3,000,000 treasury
shares, the disposal of 162,822 treasury shares as restricted shared-based remuneration, the disposal of
27,670 treasury shares by the Stock-Granting ESOP Trust, a decrease of 118 shares arising from change
in equity in entities accounted for using the equity method, and a decrease of 50 shares arising fromrequests for the additional purchase of shares as less-than-one-unit shares.

[English Translation]66

2. Dividends(1) Cash dividends paid
Resolution

Class of Shares

Total Dividends(million yen)

Dividends
Per Share(Yen)

Record Date

Effective Date

Ordinary General
Meeting ofCommon stock
3,704
22
Mar. 31, 2023
Jun. 30, 2023
Shareholders on
June 29, 2023
Board ofDirectors’
meeting on
Common stock
3,707
22
Sep. 30, 2023
Dec. 6, 2023
November 10,
2023
Note 1: The amount of “Total Dividends” resolved at the Ordinary General Meeting of Shareholders on June 29,2023 includes dividends of ¥70 million for shares of the Company held by the Stock-Granting ESOP Trust.
Note 2: The amount of “Total Dividends” resolved at the Board of Directors held on November 10, 2023 includes
dividends of ¥76 million for shares of the Company held by the Stock-Granting ESOP Trust and dividendsof ¥1 million for shares of the Company held by the Share Grant Trust Account for Directors.
(2) Dividends for which the record date is in the fiscal year under review, and the effective date is in thefollowing fiscal year.
Dividends
Total
ScheduledClass of
Source ofEffective
Per Share
Record Date
Dividends
Resolution
SharesDividends
Date(million yen)
(Yen)
Ordinary General
Meeting ofCommonRetained
Jun. 28,3,633
22Mar. 31, 2024
Shareholders onstock
earnings
2024
June 27, 2024
Note:
The amount of “Total Dividends” includes dividends of ¥75 million for shares of the Company held by the
Stock-Granting ESOP Trust and dividends of ¥1 million for shares of the Company held by the Share
Grant Trust Account for Directors.

[English Translation]

67

Notes on Financial Instruments
1. Status of Financial Instruments
The Company and the Group limit our fund management options to short-term savings and the like,procuring funding through borrowings from banks and other financial institutions.
Efforts are made to reduce client credit risk regarding notes and accounts receivable - trade, and contract
assets by regularly monitoring clients’ financial positions. Investment securities mainly consist of stock ofcompanies which have business relationships with the Company and are exposed to market price fluctuation
risks. However, the market values of listed shares are monitored on a quarterly basis.
Borrowings were made mainly to provide funds for working capital, capital investments, business financeand repayment of borrowings.
2. Fair Values of Financial Instruments
The consolidated balance sheets amounts, fair values, and differences between the two as of March 31, 2024
(the consolidated balance sheets date) are as follows. Shares without a market price, etc. (consolidated balance
sheet amount of ¥53,184 million) are not included in “securities and investment securities.”(Millions of yen)
Consolidated balance
Fair value (*)
Difference
sheets amount (*)(1) Notes and accounts receivable trade, and contract assets
74,37574,288-87(2) Securities and investment
securities
a. Held-to-maturity securities
70
68-1
b. Shares of subsidiaries andassociates
9,904
5,181
-4,722c. Available-for-sale securities:
1,020,150
1,020,150–(3) Long-term borrowings (including
current
portionof
long-term
borrowings)(3,783)(3,783)–(*) The liability items are in brackets ( ).
Note 1:“Cash and deposits,” “Notes and accounts payable - trade” and “Accounts payable - other”
The amount has been omitted because they are cash and items with a fair value that is close to the bookvalue since they are settled in a short period.
Note 2:Notes on calculating fair value of financial instruments and securities(1) Notes and accounts receivable - trade, and contract assets
Since they are mostly settled within a short period, the fair values thereof are essentially equal to the bookvalues. Accordingly, the corresponding book value is used as the fair value. The fair values of part ofaccounts receivable - trade are based on the present values calculated by discounting at a rate withcollection period and credit risk taken into account.
(2) Securities and investment securities
The market quotation at the exchange is used as the fair value for shares and the price presented by thecorrespondent financial institution and other entities is used as the fair value for bonds and others.
(3) Long-term borrowings (including current portion of long-term borrowings)
Long-term borrowings with variable interest rates are stated at book value as the interest rate on theseborrowings reflects the market rate in a short period of time and their market values approximate bookvalues. Therefore, they are based on their respective book values. Long-term borrowings with fixed interest
rates are calculated based on their present value by discounting the total amount of principal and interest
using interest rates that would presumably apply under a scenario of arranging new borrowings of a similar
nature.
Note 3:Information is omitted with respect to the investments in partnership or equivalent entities, the equity inwhich is recorded in net amount on the consolidated balance sheet. The consolidated balance sheet amount ofsuch investments stood at ¥4,151 million.
3. Breakdown of Fair Values of Financial Instruments by Level
Fair values of financial instruments are categorized into the following three levels according to theobservability and significance of inputs related to fair value measurement.

[English Translation]

68

Fair Value Level 1: Among observable inputs related to fair value measurement, the fair value measured
based on the quoted price, formed in an active market, related to the asset or liability
subject to the said fair value measurement
Fair Value Level 2: Among observable inputs related to fair value measurement, the fair value measured
using inputs related to the fair value measurement other than the Level 1 inputs
Fair Value Level 3: The fair value measured using unobservable inputs related to fair value measurement
If multiple inputs which have a significant impact on fair value measurement are used, the fair value iscategorized into the lowest level in terms of the priority in fair value measurement among the levels of these
inputs.
(1) Financial instruments recorded in the consolidated balance sheet at fair value
Category

Fair value (millions of yen)
Level 1

Level 2

Level 3

Total

Securities and investment securities
Available-for-sale securities:
SharesTotal assets

1,020,150––

1,020,150

1,020,150––

1,020,150(2) Financial instruments other than those recorded in the consolidated balance sheet at fair value
Category
Notes and accounts receivable - trade, andcontract assets

Fair value (millions of yen)
Level 1

Level 2

Level 3

Total–

74,288–74,288

–

68

–

68

Shares of affiliated companies

5,181

–

–

5,181

Total assets

5,181

74,356–

79,537Long-term borrowings (including current
portion of long-term borrowings)–(3,783)–(3,783)

Total liabilities–(3,783)–(3,783)

Securities and investment securities
Held-to-maturity securities
Bonds payable
Shares of subsidiaries and affiliatedcompanies

Notes and accounts receivable - trade, and contract assets
For some accounts receivable - trade held by the Company, the present value calculated by discounting at a
rate with collection period and credit risk taken into account is used as the fair value, and that fair value iscategorized as Fair Value Level 2 because the quoted price cannot be deemed as that in a vigorous market as thefrequency of trades in markets is small.
Securities and investment securities
Listed shares are traded in an active market. Therefore, the fair value is categorized into Fair Value Level 1.
On the other hand, bonds payable held by the Company are rarely traded in markets and the quoted price cannot
be deemed as that in an active market. Therefore, the fair value is categorized into Fair Value Level 2.
Long-term borrowings (including current portion of long-term borrowings)
The fair value of long-term borrowings is measured at present value calculated by discounting the principal
and interest using the interest rate deemed applicable to borrowings with similar conditions, and categorized into
Fair Value Level 2.
69[English Translation]

Notes on the Business Combination(Business Combination through Acquisition)
At the Board of Directors meeting held on May 12, 2023, the Company resolved to acquire the shares of
YARUKI Switch Group Holdings Co., Ltd. and make it a consolidated subsidiary, and the shares in thecompany were acquired on June 29, 2023. The Company also acquired additional shares of YARUKI Switch
Group Holdings Co., Ltd. on July 31, 2023.
1. Outline of the business combination(1) Name and business description of the acquired company
Name of the acquired company: YARUKI Switch Group Holdings Co., Ltd.
Business description: Comprehensive education conducted nationwide, starting with individual educationcram schools and also including pre-school education, English childcare, bilingual kindergartens, and kids
sports(2) Main reason for conducting the business combination
To strengthen and promote the intellectual training and education business, which is one of the priority itemsof the EDGE strategy that forms the core of the “TBS Group VISION 2030”(3) Date of business combination
June 29, 2023
(4) Legal form of business combination
Share acquisition for cash(5) Name of company after combination
No change has been made.
(6) Percentage of voting rights acquired
Percentage of voting rights acquired: 80.7%(7) Main grounds for determining the acquired company
Due to the acquisition of the shares by the Company for cash consideration.
2. Period of the acquired company’s results that are included in the consolidated financial statements
From June 1, 2023 to February 29, 2024
3. Acquisition cost of the acquired company and breakdown by type of consideration
Consideration for acquisitionCash¥30,066 million
Acquisition cost
¥30,066 million
4. Details and amount of main costs related to the acquisition
Advisory fees, etc.: ¥197 million
5. Amount of goodwill incurred, cause of goodwill, amortization method and amortization period(1) Amount of goodwill incurred¥17,585 million(2) Cause of goodwill
Goodwill was incurred due to expected future excess earning power from future business development.
(3) Amortization method and amortization period
Amortized on a straight-line basis over 20 years
6. Amounts of assets and liabilities assumed on the date of business combination and their main breakdown
Current assets¥5,761 million
Non-current assets¥31,123 million
Total assets¥36,884 million
Current liabilities¥3,921 million
Non-current liabilities¥13,521 million
Total liabilities¥17,443 million[English Translation]70

7. Amount allocated to intangible assets other than goodwill, the breakdown thereof by major type, and theweighted average amortization period
Weighted average
Type
Amountamortization period
Customer-related assets¥12,711 million
18 years
Trademark right¥8,437 million
20 years
Total¥21,148 million
8. Estimated amount and method used to calculate the impact of the business combination on the Consolidated
Statements of Income for the fiscal year under review as if the business combination had been completed at the
beginning of the fiscal year
This information is omitted as it is immaterial.
Notes on Investment and Rental Properties
1. Status of Investment and Rental Properties
The Company and some of its subsidiaries own office buildings (including land) for rent in Tokyo andother locations.
2.

Fair Values of Investment and Rental Properties
Consolidated balance sheets amount

Note 1:
Note 2:(Millions of yen)
Fair value at the end of the fiscal year under review
316,296

71,627The consolidated balance sheets amount was obtained by deducting the accumulated depreciation from the acquisition cost.
The fair values of major properties at the end of the fiscal year under review were based on the appraisal report(s) preparedby an external real-estate appraiser(s). However, in case that no significant changes have occurred in certain estimated values
and the index that seems to reflect market price appropriately since the latest evaluation, the corresponding estimated value
and index are used for adjustment. The fair values of other properties were evaluated internally with reference to the “RealEstate Appraisal Standard.”

Notes on Revenue Recognition
1. Information on Disaggregation of Revenue from Contracts with Customers
Disaggregation of revenue recognized from contracts with customers is as follows.
Media & Content
business
80,57977,645

Lifestyle businessTime–
Terrestrial
Spot–advertising revenue
Other broadcasting-related
45,584–revenue
Other real estate revenue––
Other business revenue
84,04589,903
Net sales to external customers
287,854
89,903
Note:
Leasing revenue, etc. under leasing contracts is included.

Real Estate &Other business––(Millions of yen)Total
80,57977,645–45,584

16,552–
16,552

16,552
173,949394,309

2. Basic Information for Understanding Revenue
Basic information for understanding revenue is given in “(4) Accounting policies for significant revenue andexpenses” under “4. Notes on Accounting Policies” of “Basis of Preparing Consolidated Financial Statements.”
3. Information on Relationship Between Satisfaction of Performance Obligations under Contracts with Customers
and Cash Flows Generated from Said Contracts, and Amount and Timing of Revenue Expected to Be
Recognized in the Following Fiscal Year Onward Based on Contracts with Customers Existing as of the Endof the Fiscal Year Under Review[English Translation]71

(1) Balance, etc. of contract assets and contract liabilities
Receivables arising from contracts with customers during the fiscal year under review are as follows. For
the Group, there is no significance in the balance of contract assets and contract liabilities as of the end of
the fiscal year under review and changes from the end of the previous fiscal year.
Considerations related to revenue that the Group has recognized have been received within two months fromthe satisfaction of the performance obligations in general, and do not involve significant financial elements.

Receivables arising fromcontracts with customers(Millions of yen)
As of March 31, 2024

As of April 1, 2023
65,86973,751(2) Transaction prices allocated to remaining performance obligations
For the Group, there are no significant contracts the term of which is expected to exceed one year. In addition,in consideration arising from contracts with customers, there are no monetary amounts not included intransaction prices.
Per Share Information
1.
2.

Net Assets per ShareProfit per Share

Note 1:
Note 2:¥7,038.78¥232.28

3,437,230 shares of the Company held by the Stock-Granting ESOP Trust and 62,500 shares of theCompany held by the Share Grant Trust Account for Directors are included in the treasury shares that are
excluded from the total number of issued shares at the year end to calculate net assets per share.
3,445,342 shares of the Company held by the Stock-Granting ESOP Trust and 43,545 shares of theCompany held by the Share Grant Trust Account for Directors are included in the treasury shares that are
excluded from the calculation of the average number of treasury shares during the year to calculate profit
per share.

Significant Subsequent Events(Sale of Investment Securities)
At the meeting of the Board of Directors held on April 4, 2024, the Company resolved to sell a portion of
investment securities held by a wholly-owned subsidiary of the Company, and the investment securities weresold on April 5 and April 8, 2024. As a result, the Company will record a gain on sale of investment securities(extraordinary income) in the fiscal year ending March 31, 2025.
(1) Reason for sale of investment securities
To be used as a source of funds for strategic investments, etc. and to review cross-shareholdings inaccordance with the Corporate Governance Code(2) Date of gain on sale of investment securities
April 5 and April 8, 2024
(3) Details of sale of investment securities(i) Type of assets sold: Listed securities held by two wholly-owned subsidiaries of the Company: 3 stocks(ii) Gain on sale: ¥8,385 million
Other Notes
1. Stock-Granting ESOP (Employee Stock Ownership Plan) Trust
The Company has introduced an employee incentive plan for the purpose of enhancing the employee welfare
and increasing the medium- to long-term corporate value of its wholly-owned subsidiary, Tokyo Broadcasting
System Television, Inc. (hereinafter “TBS Television”).

[English Translation]72

(1) Outline of the transactions
The Company has introduced the employee incentive plan with a view to enhancing the welfare of part ofthe employees of TBS Television (hereinafter the “TBS Television employees”) and further motivating themto contribute to increasing the Group’s medium- to long-term business performance and its corporate value.
The introduction of the employee incentive plan involved the adoption of an arrangement called StockGranting ESOP (Employee Stock Ownership Plan) Trust (hereinafter the “ESOP Trust”). The ESOP Trust,which is an employee incentive plan formulated based on the ESOP in the United States, purchases sharesof the Company and delivers such shares and/or grants the amount of cash to be realized from such sharesto the TBS Television employees according to their job grade, etc.
As the employee incentive plan shall allow the TBS Television employees to benefit economically from therising price of the Company’s shares, it is expected to incentivize the TBS Television employees who areconscious of the share price to better perform at work, as well as to enhance their morale. Furthermore, thePlan ensures that the exercise of voting rights in the shares of the Company as part of the Trust’s assets
reflects the intention of the TBS Television employees as potential beneficiary, and thus is expected to prove
effective in improving the Company’s corporate value through enhancing the TBS Television employees’
sense of participation in the management.
(2) Shares of the Company remaining within the Trust
Shares of the Company remaining within the Trust are recorded as treasury shares under net assets in the
consolidated balance sheet, based on the book value in the Trust. The book value and the number of suchshares at the end of the fiscal year under review were ¥6,372 million and 3,437,230 shares, respectively.
2. Share Grant Trust Account for Directors
Certain subsidiaries of the Company (hereinafter the “Target Subsidiaries”) have introduced a share-based
remuneration system using a trust for Directors of the Target Subsidiaries (hereinafter the “Subsidiary
Directors”).
(1) Outline of the transactions
The share-based remuneration system that uses the Share Grant Trust Account for Directors aims to raiseawareness of the Subsidiary Directors to contribute to improving medium- to long-term businessperformance and increasing corporate value, by clarifying the linkage between remuneration for theSubsidiary Directors and the value of shares of the Company, as well as by having the Subsidiary Directors
share benefits and risks of fluctuations in share prices with shareholders.
The share-based remuneration system that uses the Share Grant Trust Account for Directors is a share-based
remuneration system in which a trust established by the Company (hereinafter the “Trust”) by contributing
money on behalf of the Target Subsidiaries, as remuneration for the Subsidiary Directors, acquires theCompany’s shares using such money, and the Company’s shares in a number equivalent to the number ofpoints granted by the Target Subsidiaries to the Subsidiary Directors are granted to the Subsidiary Directors
through the Trust.
In principle, the timing at which the Subsidiary Directors receive the Company’s shares is a specified time
during the trust period. Furthermore, by entering into a transfer restriction agreement between the Company
and the Subsidiary Directors, such shares of the Company are subject to restrictions on transfer until
retirement.
(2) Shares of the Company remaining within the Trust
Shares of the Company remaining within the Trust are recorded as treasury shares under net assets in the
consolidated balance sheet, based on the book value in the Trust. The book value and the number of suchshares at the end of the fiscal year under review were ¥162 million and 62,500 shares, respectively.

[English Translation]

73

Financial Statements

Non-Consolidated Balance Sheets
Accounting ItemASSETS
Current assets:
Cash and deposits
Accounts receivable - trade
Programs and work in progress:
Prepaid expenses
Short-term loans receivable fromsubsidiaries and associates
Accounts receivable - other
Other

LIABILITIESCurrent liabilities:
Accounts payable - trade
Short-term borrowings fromsubsidiaries and associates
Accounts payable - other
Income taxes payable
Accrued consumption taxes

6,488
3,746
814
0
141
155
1,249
381
1,204,768
110,125
31,979
890
180
0
925
73,996
2,152
1,195
1,181
13
1,093,447
670,198
411,487

Allowance for doubtful accounts(27)[English Translation]

Accounting Item

As of March 31, 2024

Non-current assets:
Property, plant and equipment:
Buildings
Structures
Machinery and equipment
VehiclesTools, furniture and fixtures
Land
Construction in progress
Intangible assets:
Software
Other
Investments and other assets:
Investment securities
Shares of subsidiaries andassociates
Investments in capital ofsubsidiaries and associates
Long-term loans receivable
Long-term loans receivable fromsubsidiaries and associates
Long-term prepaid expenses
Other

Total assets(Millions of yen)

97th Business
Term

4,002
14
5,300

1,211,25674

As of March 31, 2024

130,822
1,863
120,468
2,675
5,057
183

Accrued expenses
Provision for bonuses
Other
Non-current liabilities:
Long-term deposits received
Provision for retirement benefits
Provision for share awards
Deferred tax liabilities
Other
Total liabilities
NET ASSETS
Shareholders’ equity:
Share capital
Capital surplus
Legal capital surplus
Other capital surplus
Retained earnings
Legal retained earnings

157
289
125
218,526
20,5606,544
28191,253139
349,348

Other retained earnings

334,851

General reserve
Retained earnings brought
forwardTreasury shares
Valuation and translation
adjustments:
Valuation difference on availablefor-sale securities
Total net assets
Total liabilities and net assets

38
2,432

97th BusinessTerm421,61154,98644,63435,026
9,607
339,068
4,217

194,312140,538(17,078)440,296
440,296
861,907
1,211,256

Non-Consolidated Statements of Income(Millions of yen)

97th Business Term

Accounting Item

From April 1, 2023 to March 31, 2024

18,905

Operating revenue
Real estate lease revenue

16,389Other revenue

2,515

Operating expenses
Real estate lease expenses

18,588
7,589

Other business expenses

322

General and administrative expenses

10,676

Operating profit

317

Non-operating income
Interest and dividend income

24,16524,121

Other

44

Non-operating expenses
Interest expenses

1,309
335

Share-related expenses

532

Non-deductible consumption tax, etc.

171

Other

269

Ordinary profit

23,173Extraordinary income
Gain on sale of investment securities

36,70025,432Gain on exchange associated with dividends-in-kind

11,268Extraordinary losses
Loss on valuation of shares of subsidiaries and associates

2,199
1,928

Business restructuring expenses

218

Loss on sale of investment securities

52

Profit before income taxes
Income taxes - current

57,674
9,638

Income taxes - deferred

95

Profit[English Translation]

47,94175

Non-Consolidated Statements of Changes in Equity(Fiscal Year from April 1, 2023 to March 31, 2024)(Millions of yen)

Shareholders’ equity
Capital surplus

Balance at beginning of period
Changes during period
Dividends of surplus
ProfitPurchase of treasury
shares
Disposal of treasury
sharesCancellation of treasury
sharesNet changes in items otherthan shareholders’ equity
Total changes during period
Balance at end of period

Capital
stock

Legal
capitalsurplus

OthercapitalsurplusTotal
capitalsurplusLegalretainedearnings

54,98635,026

15,074

50,1004,217–
54,986–35,026135

135(5,601)(5,601)(5,466)
9,607(5,466)44,634

Shareholders’ equity

Balance at beginning of period
Changes during period
Dividends of surplus
ProfitPurchase of treasury
shares
Disposal of treasury
sharesCancellation of treasury
sharesNet changes in items otherthan shareholders’ equity
Total changes during period
Balance at end of period[English Translation]

Treasury shares

Total shareholders’equity(11,302)392,323–
4,217

Retained earnings
Other retained earnings
Retained
Generalearnings
reservebrought
forward194,312
100,009

Total
retainedearnings(7,412)
47,941(7,412)
47,941

40,529140,538

40,529339,068–
194,312Valuation and translation adjustments
Valuation
Total valuation anddifference ontranslation
available-for-saleadjustments
securities
189,442
189,442

298,538

Total net assets
581,765(7,412)
47,941(7,412)
47,941(11,716)(11,716)(11,716)

339

475

475

5,601

–

–

(5,775)(17,078)

29,288421,61176

250,854
250,854440,296

250,854
250,854440,296

250,854
280,142861,907

Notes to Non-Consolidated Financial Statements
Basis of Preparing Non-Consolidated Financial Statements
1. Basis and Method of Valuation of Assets(1) Basis and method of valuation of securities
Shares of subsidiaries and affiliated companies:
At cost, using the moving average method
Available-for-sale securities:
a. Securities other than shares without a market price, etc.:
Market value method (Net unrealized gains/losses are shown in net assets. Realized gains/losses arecalculated using the moving average method.)b. Shares without a market price, etc.:
At cost, using the moving average method(2) Basis and method of valuation of inventories
Programs and work in progress:
Mainly at cost, using the identified cost method (bookvalue written down based on decline in profitability)
2. Method of Depreciation of Non-current Assets
Property, plant and equipment
Buildings
Straight-line method
Structures
Straight-line method (However, declining balance method is adopted forstructures acquired on or before March 31, 2016.)
Other
Declining balance method
Intangible assets
Straight-line method: Software (items used in-house) is amortized using the straight-line method
over the estimated useful life of the item (five years).
Long-term prepaid expenses
Amortized using the straight-line method
3. Accounting Policies for Provisions(1) Allowance for doubtful accounts(2) Provision for bonuses(3) Provision for retirement benefits(4) Provision for share awards

To provide against losses on defaults of notes and accounts
receivable - trade and loans receivable, the Company
provides the allowance for doubtful accounts based on ahistorical experience for general claims and on an estimateof collectability of specific doubtful receivables from
customers in financial difficulties.
To provide for the payment of bonuses to employees, theCompany provides the amount accrued at the end of thecurrent fiscal year out of the amount of bonuses expected tobe paid.
The Company provides a provision for retirement andseverance payments to employees based on the benefit
obligations estimated at the end of the fiscal year underreview. The Company has adopted the straight-line basis asa method of attributing the estimated amount to the period
up to the fiscal year under review. Actuarial gains and losses
are amortized in the following fiscal year after the period inwhich they are incurred.
To provide for the delivery of the Company’s shares to theGroup’s directors and audit & supervisory board members,
the Company provides a provision based on the estimatedshare award obligation.

4. Accounting policies for significant revenue and expenses
The Company recognizes revenue using the following five-step approach.
Step 1: Identifying the contract with a customer
Step 2: Identifying the performance obligations under the contract
Step 3: Calculating the transaction price[English Translation]

77

Step 4: Allocating the transaction price to the performance obligations under the contract
Step 5: Recognizing the revenue when the relevant company has satisfied the performance obligations
The details of the main performance obligations stemming from the primary businesses that generate revenue
from contracts with the Company’s clients and normal timing for satisfying those performance obligations(normal timing for recognizing the revenue) are as follows.
The main revenue generated from contracts with customers are management fees, and based on the contracts
with the various subsidiaries and associates, the Company is obligated to conduct management operations.
Obligations related to these management fees are recognized as revenue over the contract period.
5. Standards for Foreign Currency Translation of Foreign Currency-denominated Assets or Liabilities
All monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the
spot exchange rates as of the balance sheets date with translation differences recorded as profit or loss.
6. Other Significant Basic Items for Preparing Financial Statements(1) Accounting treatment for retirement benefits
In the non-consolidated financial statements, treatment for unrecognized actuarial gains and losses for
retirement benefits in the non-consolidated balance sheets is different from that in the consolidated
financial statements.
Notes on Non-Consolidated Balance Sheets
1. Accumulated Depreciation of Property, Plant and Equipment¥45,642 million

2. Guarantee Liabilities
Employees’ housing loans¥272 million

3. Receivables from and payables to subsidiaries and associates (excluding accounting items presented separately)
Short-term receivables from subsidiaries and associates¥6,361 million
Short-term payables to subsidiaries and associates¥571 million
Notes on Non-Consolidated Statements of Income
1. Transactions with subsidiaries and associates
Operating revenue
Operating expenses
Transactions other than ordinary operation
Gain on exchange associated with dividends-in-kind¥3,497 million¥2,160 million¥16,087 million¥11,268 million

Notes on Non-Consolidated Statements of Changes in Equity
1. Class and number of treasury shares

Common stock(Notes 1,2,3)

Number of shares at the
beginning of fiscal year
under review

Increase during fiscal
year under review

Decrease during fiscal
year under review

6,396,174

3,718,548

3,190,542(Shares)Number of shares at theend of fiscal year underreview
6,924,180

Total
6,396,174
3,718,548
3,190,542
6,924,180
Note 1: The number of treasury shares at the end of the fiscal year under review includes 3,437,230 shares of the Company held by the
Stock-Granting ESOP (Employee Stock Ownership Plan) Trust and 62,500 shares of the Company held by the Share Grant
Trust Account for Directors.
Note 2: An increase of 3,718,548 treasury shares of common stock was due to the purchase of 3,363,800 treasury shares by the
resolution of the Board of Directors, the purchase of 279,900 treasury shares by the Stock-Granting ESOP Trust, the purchaseof 62,500 treasury shares by the Share Grant Trust Account for Directors, the purchase of 11,120 shares from retirees withrestricted share-based incentives for the Employees’ Shareholding Association, and the purchase of 1,228 shares as less-thanone-unit shares.

[English Translation]

78

Note 3: A decrease of 3,190,542 treasury shares of common stock was due to the cancellation of 3,000,000 treasury shares, the disposalof 162,822 treasury shares as restricted shared-based remuneration, the disposal of 27,670 treasury shares by the StockGranting ESOP Trust, and a decrease of 50 shares arising from requests for the additional purchase of shares as less-than-oneunit shares.

Tax Effect Accounting
1. Main sources of deferred tax assets and liabilities
Investment securities and Shares of subsidiaries and associates
Provision for retirement benefits
Accrued enterprise taxes
Provision for bonuses
Valuation difference on available-for-sale securities
Other
Subtotal
Valuation reserve
Total
2.

Millions of yen
20,961
2,004
383
89(194,254)
691(170,124)(21,129)(191,253)

Main reasons for significant differences, if any, between the effective statutory tax rate and the effective
income tax rate after applying tax effect accounting
Effective statutory tax rate
(adjusted)
Entertainment expenses
Dividend income
Increase or decrease in valuation reserve
Other
Effective income tax rate after applying tax effect accounting

30.62%
0.11%(9.76%)(4.50%)
0.40%
16.87%

Notes on Revenue Recognition
1. Basic Information for Understanding Revenue
Basic information for understanding revenue is given in “4. Accounting Policies for Significant Revenue andExpenses” under “Basis of Preparing Non-Consolidated Financial Statements.”[English Translation]

79

Transactions with Related Parties
1. Subsidiaries
Classification

Name ofCompany etc.

Subsidiaries

Tokyo
Broadcasting
SystemTelevision,
Inc.

(Millions of yen)

Votingrightsownership

Relationship

Nature oftransactions

AmountItem

Year-endbalance

Directlyowning:100%

Operation
management
Sharing of officers
Borrowing of funds

Borrowings
Note 1:(50,910)Note 2:

Short-term borrowings
from subsidiaries andassociates

53,078Operation
Short-term borrowings
management
Borrowings
364
Subsidiaries
from subsidiaries andSharing of officers
Note 1:
Note 2:
associates
Borrowing of funds
Operation
Directly
Short-term borrowings
management
Borrowings
90
Subsidiaries BS-TBS, INC. owning:from subsidiaries andSharing of officers
Note 1:
Note 2:100%
associates
Borrowing of funds
Transaction terms and conditions, and policy for setting transaction terms and conditions, etc.
Note 1: The interest rate for borrowings is reasonably determined, taking market interest rates into account.
Note 2: This amount is the net of borrowings and repayments of short-term borrowings.
THE SEVEN,
INC.

Directlyowning:100%

29,30812,521Per Share Information
1.
2.

Net Assets per ShareProfit per Share

Note 1:
Note 2:¥5,331.38¥292.01

3,437,230 shares of the Company held by the Stock-Granting ESOP Trust and 62,500 shares of theCompany held by the Share Grant Trust Account for Directors are included in the treasury shares that are
excluded from the total number of issued shares at the year end to calculate net assets per share.
3,445,342 shares of the Company held by the Stock-Granting ESOP Trust and 43,545 shares of theCompany held by the Share Grant Trust Account for Directors are included in the treasury shares that are
excluded from the calculation of the average number of treasury shares during the year to calculate profit
per share.

Other Notes
1. Stock-Granting ESOP (Employee Stock Ownership Plan) Trust
Notes on the transactions related to the Stock-Granting ESOP Trust are omitted because the same details aredescribed in “Other Notes” in Notes to Consolidated Financial Statements.
2. Share Grant Trust Account for Directors
Notes on the transactions related to the Share Grant Trust Account for Directors are omitted because thesame details are described in “Other Notes” in Notes to Consolidated Financial Statements.

[English Translation]

80Audit Reports

Independent Auditors’ Report (Consolidated Statutory Report)[English Translation of the Auditors’ Report Originally Issued in the Japanese Language]
Independent Auditors’ Report
May 8, 2024

The Board of Directors
TBS Holdings, Inc.

KPMG AZSA LLC
Tokyo Office
Katsunori Tsukahara
Designated and Engagement Partner
Certified Public Accountant
Takeshi Nakatani
Designated and Engagement Partner
Certified Public Accountant

Audit Opinion
We have audited the consolidated statutory report, comprising the consolidated balance sheets,the consolidated statements of income, the consolidated statements of changes in equity andthe related notes of TBS Holdings, Inc. as of March 31, 2024 and for the 97th business termfrom April 1, 2023 to March 31, 2024 in accordance with Article 444 (4) of the Companies
Act.
In our opinion, the consolidated statutory report referred to above presents fairly, in allmaterial respects, the financial position and the results of operations of TBS Holdings, Inc.
and its consolidated subsidiaries for the period, for which the consolidated statutory report
was prepared, in conformity with accounting principles generally accepted in Japan.
Basis for the Audit Opinion
The audit was conducted in accordance with auditing standards generally accepted in Japan.
Our responsibilities under the auditing standards are described in the section “Responsibilityof Auditor in the Audit of the Consolidated Statutory Report.” In accordance with the rules ofprofessional ethics in Japan, we are independent from the Company and its consolidated
subsidiaries and have fulfilled our other ethical responsibilities as Auditors. We believe that
we have obtained sufficient and appropriate audit evidence to serve as a basis for our opinion.
Other Information
Other Information consists of the business report and its supporting schedules. It is the
responsibility of management to prepare and disclose Other Information. In addition, it is the
responsibility of the Audit & Supervisory Board members and the Audit & Supervisory Board
to monitor the performance of Directors’ duties in the development and operation of the Other
Information reporting process.
Other Information is not included in the scope of our audit opinion on the consolidated
statutory report, and we do not express our opinion on Other Information.
Our responsibility in auditing the consolidated statutory report is to read through Other
Information and, in the course of reading through Other Information, examine whether there is
any significant discrepancy between Other Information and the consolidated statutory reportor our knowledge obtained during the process of the audit, and in addition, pay attention towhether there is any sign of material error in Other Information other than such significant
discrepancy.
[English Translation]81

We are required to report to that effect if we determined that there is any material error in
Other Information based on the work we carried out.
There is no matter that we should report concerning Other Information.
Responsibility of Management, Audit & Supervisory Board and its Members for theConsolidated Statutory Report, etc.
Management is responsible for the preparation and fair presentation of the consolidated
statutory report in accordance with accounting principles generally accepted in Japan. The
responsibility includes designing, implementing and maintaining internal control relevant to
the preparation and fair presentation of the consolidated statutory report that are free frommaterial misstatement due to fraud or error.
In preparing the consolidated statutory report, management is responsible for assessing
whether it is appropriate to prepare the consolidated statutory report on the basis of going
concern assumptions, and for disclosing going concern matters in accordance with businessaccounting principles generally accepted in Japan, if such disclosures are necessary.
It is the responsibility of the Audit & Supervisory Board members and the Audit &Supervisory Board to monitor the performance of Directors’ duties in the development andoperation of the financial reporting process.
Responsibility of Auditor in the Audit of the Consolidated Statutory Report
The auditor’s responsibility is to obtain reasonable assurance about whether the consolidated
statutory report as a whole is free of material misstatement, whether due to fraud or error,
based on the audit performed by the auditor, and to express an opinion on the consolidated
statutory report in the Auditor’s Report from an independent standpoint. A misstatement may
result from fraud or error and is considered material if it, individually or in aggregate, could
reasonably be expected to affect the decision-making of users of the consolidated statutory
report.
The auditor shall exercise professional judgment throughout the course of the audit inaccordance with auditing standards generally accepted in Japan, maintain professional
skepticism, and perform the following.
•

Identify and assess the risk of material misstatement due to fraud or error. Also design
and implement audit procedures that address the risk of material misstatement. The
selection and application of audit procedures is at the discretion of the auditor. In
addition, obtain sufficient and appropriate audit evidence on which to base the opinion.

•

In making risk assessments, the auditor considers internal controls that are relevant to theentity’s audit in order to design audit procedures that are appropriate in the circumstances
but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control.

•

Assess the suitability of the accounting policies adopted by management and the methodof application thereof, and the rationality of the accounting estimates made bymanagement and the related notes.

•

Conclude whether it is appropriate for management to prepare the consolidated statutory
report on a going concern basis and whether, based on the audit evidence obtained, there
is a material uncertainty about events or circumstances that would give rise to a material
doubt about the going concern. If there is a material uncertainty about the going concern,
the auditor is required to draw attention to the notes to the consolidated statutory report in
the auditor’s report or, if the notes to the consolidated statutory report regarding thematerial uncertainty are not appropriate, to express an opinion on the consolidated
statutory report with excepted matter. Although the auditor’s conclusions are based on
audit evidence obtained up to the date of the audit report, future events and circumstances
may cause the entity to cease to be a going concern.

[English Translation]82

•

Assess whether the presentation and notes to the consolidated statutory report comply
with accounting principles generally accepted in Japan, and whether the presentation,
structure and content of the consolidated statutory report, including related notes, and thepresentation of transactions and the accounting matters on which the consolidated
statutory report are based are appropriate.

•

Obtain sufficient and appropriate audit evidence about the financial information of theCompany and its consolidated subsidiaries in order to express an opinion on the
consolidated statutory report. The auditor is responsible for the direction, supervision andimplementation of the audit of the consolidated statutory report. The auditor is solely
responsible for the audit opinion.

The auditor shall report to the Audit & Supervisory Board members and the Audit &Supervisory Board on the scope and timing of the planned audit, any material audit findings,
including any material weaknesses in internal controls identified in the course of conducting
the audit, and any other matters required by the auditing standards.
The auditor shall report to the Audit & Supervisory Board members and the Audit &Supervisory Board on compliance with the rules of professional ethics on independence inJapan and any matters reasonably believed to affect the auditor’s independence, and whereapplicable, the details of any measures taken in order to eliminate impediments and any
safeguards that have been applied to reduce impediments to acceptable levels.
Interests
Our firm and engagement partners have no interest in the Company and its consolidated
subsidiaries which should be disclosed pursuant to the provisions of the Certified Public
Accountants Act of Japan.

[English Translation]

83

Independent Auditors’ Report (Statutory Report)[English Translation of the Auditors’ Report Originally Issued in the Japanese Language]
Independent Auditors’ Report
May 8, 2024

The Board of Directors
TBS Holdings, Inc.

KPMG AZSA LLC
Tokyo Office
Katsunori Tsukahara
Designated and Engagement Partner
Certified Public Accountant
Takeshi Nakatani
Designated and Engagement Partner
Certified Public Accountant

Audit Opinion
We have audited the statutory report, comprising the balance sheets, the statements of income,the statements of changes in equity and the related notes, and its supporting schedules(hereinafter collectively referred to as the “statutory report, etc.”) of TBS Holdings, Inc. as ofMarch 31, 2024 and for the 97th business term from April 1, 2023 to March 31, 2024 inaccordance with Article 436, Paragraph 2, Item 1 of the Companies Act.
In our opinion, the statutory report, etc. referred to above presents fairly, in all material
respects, the financial position and the results of operations for the period, for which thestatutory report, etc. was prepared, in conformity with accounting principles generally
accepted in Japan.
Basis for the Audit Opinion
The audit was conducted in accordance with auditing standards generally accepted in Japan.
Our responsibilities under the auditing standards are described in the section “Responsibilityof Auditor in the Audit of the Statutory Report, etc.” In accordance with the rules ofprofessional ethics in Japan, we are independent from the Company and have fulfilled ourother ethical responsibilities as Auditors. We believe that we have obtained sufficient andappropriate audit evidence to serve as a basis for our opinion.
Other Information
Other Information consists of the business report and its supporting schedules. It is the
responsibility of management to prepare and disclose Other Information. In addition, it is the
responsibility of the Audit & Supervisory Board members and the Audit & Supervisory Board
to monitor the performance of Directors’ duties in the development and operation of the Other
Information reporting process.
Other Information is not included in the scope of our audit opinion on the statutory report,
etc., and we do not express our opinion on Other Information.
Our responsibility in auditing the statutory report, etc. is to read through Other Information
and, in the course of reading through Other Information, examine whether there is any
significant discrepancy between Other Information and the statutory report, etc. or our
knowledge obtained during the process of the audit, and in addition, pay attention to whether
there is any sign of material error in Other Information other than such significant
discrepancy.

[English Translation]84

We are required to report to that effect if we determined that there is any material error in
Other Information based on the work we carried out.
There is no matter that we should report concerning Other Information.
Responsibility of Management, Audit & Supervisory Board and its Members for the Statutory
Report, etc.
Management is responsible for the preparation and fair presentation of the statutory report,
etc. in accordance with accounting principles generally accepted in Japan. The responsibility
includes designing, implementing and maintaining internal control relevant to the preparationand fair presentation of the statutory report, etc. that are free from material misstatement due
to fraud or error.
In preparing the statutory report, etc., management is responsible for assessing whether it isappropriate to prepare the statutory report, etc. on the basis of going concern assumptions, andfor disclosing going concern matters in accordance with business accounting principles
generally accepted in Japan, if such disclosures are necessary.
It is the responsibility of the Audit & Supervisory Board members and the Audit &Supervisory Board to monitor the performance of Directors’ duties in the development andoperation of the financial reporting process.
Responsibility of Auditor in the Audit of the Statutory Report, etc.
The auditor’s responsibility is to obtain reasonable assurance about whether the statutory
report, etc. as a whole are free of material misstatement, whether due to fraud or error, basedon the audit performed by the auditor, and to express an opinion on the statutory report, etc. in
the Auditor’s Report from an independent standpoint. A misstatement may result from fraud
or error and is considered material if it, individually or in aggregate, could reasonably be
expected to affect the decision-making of users of the statutory report, etc.
The auditor shall exercise professional judgment throughout the course of the audit inaccordance with auditing standards generally accepted in Japan, maintain professional
skepticism, and perform the following.
•

Identify and assess the risk of material misstatement due to fraud or error. Also design
and implement audit procedures that address the risk of material misstatement. The
selection and application of audit procedures is at the discretion of the auditor. In
addition, obtain sufficient and appropriate audit evidence on which to base the opinion.

•

In making risk assessments, the auditor considers internal controls that are relevant to theentity’s audit in order to design audit procedures that are appropriate in the circumstances
but not for the purpose of expressing an opinion on the effectiveness of the entity’s
internal control.

•

Assess the suitability of the accounting policies adopted by management and the methodof application thereof, and the rationality of the accounting estimates made bymanagement and the related notes.

•

Conclude whether it is appropriate for management to prepare the statutory report, etc. ona going concern basis and whether, based on the audit evidence obtained, there is amaterial uncertainty about events or circumstances that would give rise to a material
doubt about the going concern. If there is a material uncertainty about the going concern,
the auditor is required to draw attention to the notes to the statutory report, etc. in theauditor’s report or, if the notes to the statutory report, etc. regarding the material
uncertainty are not appropriate, to express an opinion on the statutory report, etc. withexcepted matter. Although the auditor’s conclusions are based on audit evidence obtained
up to the date of the audit report, future events and circumstances may cause the entity tocease to be a going concern.

[English Translation]85

•

Assess whether the presentation and notes to the statutory report, etc. comply withaccounting principles generally accepted in Japan, and whether the presentation, structure
and content of the statutory report, etc., including related notes, and the presentation of
the transactions and the accounting matters on which the statutory report, etc. are based
are appropriate.

The auditor shall report to the Audit & Supervisory Board members and the Audit &Supervisory Board on the scope and timing of the planned audit, any material audit findings,
including any material weaknesses in internal controls identified in the course of conducting
the audit, and any other matters required by the auditing standards.
The auditor shall report to the Audit & Supervisory Board members and the Audit &Supervisory Board on compliance with the rules of professional ethics on independence inJapan and any matters reasonably believed to affect the auditor’s independence, and whereapplicable, the details of any measures taken in order to eliminate impediments and any
safeguards that have been applied to reduce impediments to acceptable levels.
Interests
Our firm and engagement partners have no interest in the Company which should be disclosed
pursuant to the provisions of the Certified Public Accountants Act of Japan.

[English Translation]

86

Audit & Supervisory Board’ Report[English Translation of the Auditors’ Report Originally Issued in the Japanese Language]
AUDIT REPORTThe Audit & Supervisory Board has received the reports of the business performance ofthe directors during the 97th business term from April 1, 2023 through March 31, 2024 fromeach of the Audit & Supervisory Board members. After discussing the reports, we have
prepared this Audit Report and report as follows.
1. Method and Details of Audit Performed by Audit & Supervisory Board Members and the
Audit & Supervisory Board
The Audit & Supervisory Board established the audit policy and division of
responsibilities, received reports on the status and results of audits from Audit & Supervisory
Board members, received reports on the status of execution of duties from directors andindependent auditors, and requested explanations when necessary.
Each of the Audit & Supervisory Board members, in accordance with the auditing
standards established by the Audit & Supervisory Board, audit plan and division of
responsibilities, worked to communicate with directors, Legal & Compliance Division, theOffice of Internal Audit and other employees, made efforts to gather information and establish
the audit environment, in addition to attending the meetings of the Board of Directors andother important meetings, receiving reports from the directors and other managers on theirduties, requesting explanations when necessary, inspecting documents concerning matterssuch as important decisions, and investigating the conditions of the business and financial
conditions. Standing statutory Audit & Supervisory Board members concurrently serve as
Audit & Supervisory Board members of important subsidiaries, and we worked tocommunicate and exchange information with directors and Audit & Supervisory Board
members of subsidiaries and received reports on operations when necessary. From theperspective of Group audits, liaison meetings were held with standing statutory Audit &Supervisory Board members of the Group companies as members to exchange informationand opinions.
In addition, we received periodic reports from directors and employees on the status
with respect to the content of the resolution of the Board of Directors concerning theestablishment and operation of the systems necessary to ensure that the business performanceby the directors, as shown in the Business Report, complies with laws and the Articles ofIncorporation, and other systems necessary to ensure the properness of operations of a
Corporate Group consisting of a Stock Company and its subsidiaries stipulated in Paragraphs
1 and 3 of Article 100 of the Regulation for Enforcement of the Companies Act and the statusof the system based on such resolution (internal control system). When necessary, we
expressed opinions. We examined the principal of policies and efforts of controlling theCompany (Item 3 (a) and (b) of Article 118 of the Regulation for Enforcement of theCompanies Act) as shown in the Business Report, understanding discussions made at theBoard of Directors’ meeting or other occasions.
Furthermore, in addition to monitoring and examining whether the independent auditor
maintained an independent position and performed auditing appropriately, we received reports
from the independent auditor on the execution of its duties and requested explanations whennecessary. In addition, we received notice from the independent auditor that “The systems for
ensuring the proper execution of duties” (set forth in each Item of Article 131 of the Rules ofCorporate Accounting) is organized in accordance with the “Standards for Quality Control of
Audit” (Business Accounting Council) and other relevant standards, and requested
explanations when necessary.
Based on the above methods, we examined the Business Report and supporting
schedules, non-consolidated financial statements (balance sheets, statements of income,statements of changes in equity, notes to non-consolidated financial statements), supporting
schedules, and the consolidated financial statements (consolidated balance sheets,[English Translation]

87

consolidated statements of income, consolidated statements of changes in equity, notes toconsolidated financial statements) for the fiscal year under review.
2. Result of Audit(1) Result of audit of Business Reporti) The Business Report and supporting schedules fairly represent the condition of theCompany in accordance with the law and the Articles of Incorporation of theCompany.
ii) We have determined that there were no serious occurrences of dishonest or false
activity or violations of any laws or the Company’s Articles of Incorporation by any ofthe directors in carrying out their duties.
iii) We believe the details of resolutions of the Board of Directors regarding the internal
control system are appropriate. We found no matters of note regarding the contents of
the Business Report and the execution of duties of directors regarding the internal
control system.
iv) Nothing has to be reported to point out in the principle policies for controlling theCompany as a part of the Business Report.
We have assured that the efforts made to realize the policies in the Business Report are
accordance with Item 3 (b) of Article 118 of the Regulation for Enforcement of theCompanies Act and they are aiming at neither harming the common interest ofshareholders nor protecting own interests of the directors of the Company.
(2) Result of audit of non-consolidated financial statements and supporting schedules
In our opinion, the audit procedures and audit results received from the independent
auditor KPMG AZSA LLC are appropriate.
(3) Result of audit of consolidated financial statements
In our opinion, the audit procedures and audit results received from the independent
auditor KPMG AZSA LLC are appropriate.
May 14, 2024

Audit & Supervisory Board of
TBS Holdings, Inc.
Standing Statutory Audit & Supervisory Board Member
Tomohiko Nishino
Standing Statutory Audit & Supervisory Board Member
Tetsuya Ichikawa
Outside Audit & Supervisory Board Member
Teisuke Kitayama
Outside Audit & Supervisory Board Member
Mie Fujimoto
Outside Audit & Supervisory Board Member
Somitsu Takehara[English Translation]

88