Translation
Notice: This document is an excerpt translation of the original Japanese document and is only for reference purposes. In the event of any
discrepancy between this translated document and the original Japanese document, the latter shall prevail.

Summary of Consolidated Financial Results
for the Six Months Ended September 30, 2020
(Based on IFRS)
Company name:

Stock exchange listing: Tokyo
Securities code:
4819
Representative:
Inquiries:

November 13, 2020

Digital Garage, Inc.
URL

https://www.garage.co.jp/

Representative Director,Kaoru Hayashi
President Executive Officer and Group CEOMember, Board of Directors, Senior
Managing Executive Officer,in charge of the Makoto Soda

TEL

Corporate Strategy Division
Scheduled date to file Quarterly Securities Report:

November 13, 2020

Scheduled date to commence dividend payments:
Preparation of supplementary material on quarterly financial results:–Yes

Holding of quarterly financial results meeting:Yes

03-6367-1111(for institutional investors and analysts)(Amounts are rounded off to the nearest million yen)
1. Consolidated financial results for the six months ended September 30, 2020 (from April 1, 2020 to September 30, 2020)(1) Consolidated operating results (cumulative)
RevenueSix months ended
September 30, 2020
Six months ended
September 30, 2019

Profit before tax
Millions ofyen

Percentages indicate year-on-year changes
Profit attributable Comprehensive
to owners of parent
incomeMillions ofMillions%%%
yenof yen

ProfitMillions ofyen%

19,264(1.7)

6,037 (17.6)

3,884 (25.9)

4,003 (24.1)

5,386 (23.4)

19,596

7.5

7,326

5,240

5,271

7,028%

Millions ofyen(1.0)

Basic earnings per share

(9.3)

Yen
79.55
104.60(2) Consolidated financial position
Total assets

As of September 30, 2020
As of March 31, 2020

13.1

Diluted earnings per share

Yen
86.96
114.68Six months ended September 30, 2020
Six months ended September 30, 2019

(7.9)

Total equity

Millions of yen
166,206
162,296

Ratio of equity
attributable to owners ofparent to total assets
Millions of yen%
56,075
33.7
52,03332.1

Equity attributable toowners of parent

Millions of yen
57,114
52,795

2. Cash dividends
Annual dividends per share

Year ended March 31, 2020
Year ending March 31, 2021

1st quarter-end

2nd quarter-end

3rd quarter-end

Fiscal year-end

Yen––Yen
0.00
0.00

Yen–Yen
38.00

Total

Year ending March 31, 2021 (Forecast)––(Note 1. Revision to the forecast on financial results: No)(Note 2. Breakdown of year-end dividends for the year ended March 31, 2020 Ordinary dividend: 28.00 Yen Commemorative dividend:10.00 Yen)
(Note 3. Fiscal year ending March 31, 2021 forecast is to be determined.)

1

Yen
38.00
–

3. Consolidated Earnings Forecast for the Fiscal Year Ending March 31, 2021 (April 1, 2020 to March 31, 2021)
In the field of investment and incubation in domestic and overseas unlisted companies in the Incubation Technology Segment, it is difficult toreasonably estimate the fair value of securities held by Digital Garage Group at the end of the fiscal year. Therefore, Digital Garage, Inc. does notdisclose consolidated financial forecasts.
4. Notes(1) Changes in significant subsidiaries during the six months ended September 30, 2020(changes in specified subsidiaries resulting in the change in scope of consolidation):No(2) Changes in accounting policies and changes in accounting estimates
Changes in accounting policies required by IFRS:
Changes in accounting policies due to other reasons:

NoNo

Changes in accounting estimates:No(3) Number of issued shares (ordinary shares)
Total number of issued shares at end of period (including treasury shares)
As of September 30, 2020

47,428,500 shares As of March 31, 2020

47,406,800 shares

1,363,549 shares As of March 31, 2020

1,390,316 shares

Number of treasury shares at end of period
As of September 30, 2020

Average number of shares during period (cumulative from the beginning of the fiscal year)
Six months ended September 30, 2020

46,031,452 shares Six months ended September 30, 2019245,964,815 shares

Condensed quarterly consolidated financial statements
Condensed quarterly consolidated statement of financial position(Millions of yen)
As of March 31, 2020

As of September 30, 2020

AssetsCurrent assets
Cash and cash equivalents

32,702

39,259Trade and other receivables
Inventories

26,657319

19,157295

Operational investment securities
Other financial assets

36,546
1,323

40,585
1,012

324
980

–499

98,852

100,806

Property, plant and equipment
Goodwill

21,367
7,689

20,388
7,689

Intangible assets
Investment property

3,496
2,932

3,699
2,822

Investments accounted for using equity method
Other financial assets

21,475
6,319

21,736
8,858

Deferred tax assets
Other non-current assets

45
120

64
144

Total non-current assets

63,44465,401

162,296

166,206

Income taxes receivable
Other current assets
Total current assets
Non-current assets

Total assets3

(Millions of yen)
As of September 30, 2020

As of March 31, 2020
Liabilities and equity
Liabilities
Current liabilities
Borrowings

4,927

6,678

Trade and other payables
Other financial liabilities

41,203
1,783

34,754
1,807

Income taxes payable
Other current liabilities

207
2,717

491
3,557

Total current liabilities

50,83847,287

Bonds and borrowings
Other financial liabilities

38,247
13,55339,57012,966Retirement benefit liability
Provisions

571
589

437
562

Deferred tax liabilities
Other non-current liabilities

5,426
278

7,347
924

Total non-current liabilities

58,66361,805109,501

109,092

Share capital
Capital surplus

7,591
4,409

7,619
4,569

Treasury shares
Other components of equity(5,012)324(4,915)
1,826

Retained earnings

44,721

46,975

Total equity attributable to owners of parent

52,03356,075

Non-current liabilities

Total liabilities
EquityNon-controlling interests
Total equity
Total liabilities and equity

4762

1,039

52,795

57,114

162,296

166,206

Condensed quarterly consolidated statements of income
First six months of fiscal year
(Millions of yen)Six months ended
September 30, 2020

Six months ended
September 30, 2019
Revenue
Revenue in recurring business

12,856

12,449

3,790
1,239

5,270
400

171

1,694

1,143

19,596

19,264

5,716

5,593

6,089
164

7,041
178

301

415

12,27013,228

Profit before tax
Income tax expense

7,326
2,086

6,037
2,153

Profit

5,240

3,884

Profit (loss) attributable toOwners of parent

5,271

4,003

Non-controlling interests

(31)

(119)

114.6886.96

104.6079.55

Revenue in operational investment securities
Other income
Finance income
Share of profit of investments accounted for using equity
methodTotalExpenses
Cost of sales
Selling, general and administrative expenses
Other expenses
Finance costs
TotalEarnings per share
Basic earnings per share
Diluted earnings per share5Stand-alone 2nd quarter of fiscal year
2nd quarter endedSeptember(Millions of yen)
2nd quarter endedSeptember

30, 2019

30, 2020

Revenue
Revenue in recurring business
Revenue in operational investment securities

6,718
3,332

6,301
4,968

Other income
Finance income

422
16207
0

Share of profit of investments accounted for using equity
method891

843

11,37912,320

2,976
3,138

2,829
3,588

8671109
163

6,271

6,689

Profit before tax

5,108

5,632

Income tax expense

1,485

1,902

Profit

3,623

3,730

3,647
(24)

3,779
(50)

79.33
72.11

82.08
74.56

TotalExpenses
Cost of sales
Selling, general and administrative expenses
Other expenses
Finance costs
Total

Profit (loss) attributable toOwners of parent
Non-controlling interests
Earnings per share
Basic earnings per share
Diluted earnings per share6Condensed quarterly consolidated statements of comprehensive income
First six months of fiscal year(Millions of yen)Six months ended
September 30, 2020

Six months endedSeptember 30, 2019
ProfitOther comprehensive income

5,240

3,884

1,921

1,664(27)

3(107)(165)

10

Other comprehensive income

1,787

1,502

Comprehensive income

7,028

5,386

7,058(31)

5,505
(119)

Items that will not be reclassified to profit or loss
Net change in fair value of equity instruments designatedas measured at fair value through other comprehensiveincome
Share of other comprehensive income of investments
accounted for using equity method
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Share of other comprehensive income of investments
accounted for using equity method

Comprehensive income attributable toOwners of parent
Non-controlling interests

7

Stand-alone 2nd quarter of fiscal year

Profit

2nd quarter endedSeptember(Millions of yen)
2nd quarter endedSeptember

30, 2019

30, 2020
3,623

3,730

(1,186)

301

(3)

(3)

4(95)

00

Other comprehensive income(1,184)203

Comprehensive income

2,439

3,932

2,462

3,982

(23)

(50)

Other comprehensive income
Items that will not be reclassified to profit or loss
Net change in fair value of equity instruments designatedas measured at fair value through other comprehensive
incomeShare of other comprehensive income of investments
accounted for using equity method
Items that may be reclassified to profit or loss
Exchange differences on translation of foreign operations
Share of other comprehensive income of investments
accounted for using equity method

Comprehensive income attributable toOwners of parent
Non-controlling interests8

Condensed quarterly consolidated statement of changes in equity
Six months ended September 30, 2019 (from April 1, 2019 to September 30, 2019)(Millions of yen)
Equity attributable to owners of parent
Other components of equity

Share
capitalBalance at April 1, 2019

Capitalsurplus7,504

Financial assets

Exchangemeasured at

differenceson

Remeasurements

comprehensive

translationof foreign

benefit plansincomeoperations

Treasuryshares4,235

fair value
through other(5,026)

Profit (loss)
Other comprehensive income
Comprehensive income
Issuance of new shares
Changes in ownership interest in–

–

43

43

–

75

1,231

1,893

(106)

1,893

(106)

Totalof defined(3)

–
1,787
–

1,787
–
–

subsidiaries
Dividends–

Share-based remunerationtransactions

154

Purchase of treasury shares
Disposal of treasury shares(0)

Other(1)

Total
Balance at September 30, 2019

1,303–(0)
14–––

43196

14––––

7,547

4,431

(5,012)

1,968

1,125(3)3,090(Millions of yen)
Equity attributable to owners of parent
Retained earnings
Balance at April 1, 2019
Profit (loss)

38,5935,271
5,271

Changes in ownership interest in
subsidiaries
Dividends
Share-based remuneration(1,287)transactions
Purchase of treasury shares
Disposal of treasury shares
OtherTotal
Balance at September 30, 2019

Totalinterests

Total

Other comprehensive income
Comprehensive income
Issuance of new shares

Non-controlling

46,609
5,271

736
(31)

47,345
5,240

1,787

0

1,787

7,058
86

(31)

7,028
86

–

34

34

(1,287)(1,287)

154

154

(0)

(0)

14(1)

14(1)

(1,287)(1,033)34(999)42,57852,634740

53,3749

Six months ended September 30, 2020 (from April 1, 2020 to September 30, 2020)(Millions of yen)
Equity attributable to owners of parent
Other components of equity
Financial assets

Share

CapitalTreasurycapitalsurplus

sharesmeasured atfair value
through othercomprehensive
incomeBalance at April 1, 2020
Profit (loss)

7,591

4,409(5,012)

Other comprehensive income
Comprehensive income
Issuance of new shares

–28

–
28

Changes in ownership interest in
subsidiaries

benefit plansof foreign
operations

(798)

1,125

1,667

(165)

1,667

(165)

Totalof defined

(2)

324
–
1,502

–

1,502–––

137

transactions
Purchase of treasury shares
Other
Balance at September 30, 2020

Remeasurements

ontranslation(3)

Dividends
Share-based remuneration

Total–

Exchangedifferences

97

–(0)

–(0)

–28

161

97

–––

–

7,619

4,569

(4,915)

868

960

(2)

1,826

(Millions of yen)
Equity attributable to owners of parent
Retained earnings
Balance at April 1, 2020
Profit (loss)

44,721
4,003
4,003

Changes in ownership interest in
subsidiaries
Dividends
Share-based remuneration(1,749)transactions
Purchase of treasury shares
OtherTotal
Balance at September 30, 2020

Totalinterests

Total

Other comprehensive income
Comprehensive income
Issuance of new shares

Non-controlling

52,033
4,003

762
(119)

52,7953,8841,502

1

1,502

5,505
55

(119)

5,386
55

(3)

396

393

(1,749)(1,749)

234

234

(0)

(0)

(0)

(0)

(1,749)(1,463)396(1,067)

46,97556,075

1,039

57,11410

Condensed quarterly consolidated statements of cash flows
Six months ended(Millions of yen)Six months ended

September 30, 2019

September 30, 2020

Cash flows from operating activities
Profit before tax
Depreciation and amortization

7,326
1,046

6,037
1,788

(2)
125

(1)
120

Share of loss (profit) of investments accounted for using
equity method(1,694)(1,143)

Loss (gain) on sales of shares of subsidiaries and associates
Decrease (increase) in trade and other receivables

(642)
1,658

–
7,677

Decrease (increase) in investment securities for sale
Decrease (increase) in inventories(6,597)(101)(4,226)24

Increase (decrease) in trade and other payables
Increase (decrease) in accrued consumption taxes(7,195)(64)(5,313)979

Interest and dividend income
Interest expenses on borrowings and bonds

Other(161)

1,187(6,302)789

7,129719

(51)
(960)

(38)
(49)

(6,524)

7,760

(638)

(1,314)

(902)
(2)

(789)
(1)

Payments for acquisition of subsidiaries
Purchase of investments accounted for using equity method(1,043)(500)––

Proceeds from sale of investments accounted for using equity
method762

79

Payments of leasehold and guarantee deposits
Other

(779)
527

(8)
107

(2,575)(1,925)

Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings

(268)
–

1,810
3,037

Repayments of long-term borrowings
Repayments of lease liabilities

(332)
(482)

(1,816)(949)34(1,285)

396(1,747)

SubtotalInterest and dividends received
Interest paid
Income taxes refund (paid)
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities

Net cash provided by (used in) investing activities
Cash flows from financing activities

Capital contribution from non-controlling interests
Dividends paid
Other
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents

3827(2,296)

757

(95)

(35)

Net increase (decrease) in cash and cash equivalents(11,489)

6,556

Cash and cash equivalents at beginning of period

48,15432,702

Cash and cash equivalents

36,66539,25911