First Quarter of the Fiscal Year Ending June 30, 2022 (FY2022)

Results of Operations
Explanatory Material

November 15, 2021
HOPE, INC.
[6195]

Corporate Philosophy

Providing new value to citizens
through local governments,

and promoting growth of the company
and its people

Copyright (C) 2021 HOPE, INC.

02

Company Overview
Company name

HOPE, INC.

EstablishedFeb. 2005 (fiscal year-end: Jun.)

Representative

Takayasu Tokitsu, CEO

Securities code

6195 (listed on the TSE-Mothers/FSE Q-Board on Jun. 15, 2016)

Employees(consolidated)

163 (as of the end of Sep. 2021, including temporary employees)

Business

Services created specifically for local governments

Head office

MG Yakuin Building 1-14-5, Yakuin, Chuo-ku, Fukuoka, Japan

History

Feb. 2005 Founded

May 2020 Started Jichitai Works HAxSH

Jun. 2006 Launched SMART RESOURCE SERVICE

Oct. 2020 Established a wholly owned
subsidiary HOPE ENERGY, INC.

(Advertising Business, Energy Business, Jichitai Works Business)

Sep. 2013 Launched SMART CREATION SERVICE“Machilet”
Jul. 2014

Launched “Machiiro,” an app that connects
local governments and local residents

Aug. 2014 Started B-to-G solutions business
Jun. 2016 Listed on TSE-Mothers and FSE Q-Board
Dec. 2017 Issued the first edition of“Jichitai Works”
Mar. 2018 Registered as an electricity retailer
and launched “GENEWAT”

Nov. 2020 Developed AI for forecasting market pricesof electricity (Energy Business)
Mar. 2021 Announced participation in the private-sector
trainee program of the city of Shijonawate
in Osaka prefecture
Jun. 2021 Launched SMART FR CONSULTING SERVICE
Launched the Jichitai Works Free Name Card service
Sep. 2021 Announced actions for ending negative equity

Copyright (C) 2021 HOPE, INC.

03

Contents

I. 1Q FY2022 Financial Highlights
II. Topics
III. FY2022 Outlook
IV. Business Environment and Growth Strategies
V. 2020 VISION
VI. Appendices

Copyright (C) 2021 HOPE, INC.

04

I. 1Q FY2022 Financial Highlights

Application of the netting method in the Energy Business• From FY2022, all figures in this presentation use the netting method* due to the application of the Accounting Standard for Revenue Recognition (Accounting Standards Board of Japan
Statement No. 29).
• Both net and gross figures are shown for figures until 4Q FY2021. Please refer to net figures in prior years when making comparisons.
• The differences of the netting and gross recognition methods have no effect on earnings at all levels.
*With the netting method, in accordance with the renewable energy feed-in tariff system in Japan, fees received from customers (sales) and payments to the cost adjustment organization(cost of sales), which are equal to fees received, offset each other, resulting in the recognition of net revenue. Figures that do not use netting are designated in this presentation as using thegross recognition method.

Start of consolidated financial statements• Due to the establishment of HOPE ENERGY, INC., which is a wholly owned subsidiary, HOPE, INC. changed from non-consolidated to consolidated financial statements beginning with thesecond quarter of the fiscal year ended in Jun. 2021. As a result, this presentation has both consolidated and non-consolidated financial information.
• Numbers are rounded down and percentages are rounded up or down to the first decimal place.
• All documents referenced in the following pages are in Japanese version only.

Copyright (C) 2021 HOPE, INC.

05

Impact of COVID 19

Response to COVID-19
Started a COVID-19 Response Team

Monitors health of employees and makes preparations for responses to outbreaks.

Established a teleworking infrastructure

Created an environment that facilitates teleworking for a broad range of tasks.

Online activities and no outings for businessAs a rule, the internet is used for all meetings with people outside the company.

Effect on business operations
Advertising/Jichitai Works BusinessNo significant effect at this time, but some companies may start to reduce their advertising activities.
There is also a risk that financial difficulties at advertisers may delay payments for some receivables or make it
impossible to collect some receivables.

Energy BusinessAlthough the downturn in the demand for electricity associated with temporary closings of schools and other public-sector
buildings has stopped, the COVID-19 crisis may continue to have effects on electricity demand and the purchases ofelectricity.

Copyright (C) 2021 HOPE, INC.

06

Financial Summary (1Q FY2022)

1Q FY2022 Results(consolidated)

Sales were up 114.4% from one year earlier to an all-time highOperating profit was ¥(126) million, in line with our plan

■Operating profit■Net sales¥12,978 million (up 114.4% YoY)

Advertising Business¥(126) million (¥686 million in 1Q FY2021)

Energy Business

Jichitai Works Business

Aim for higher productivity
through measures for theproper size of this business

Record-high volume of electricity
supplied due to winning bids in FY2021;
plan to downsize this business

Sales and earnings growth due toan increase in B-to-G solutions
orders■Net sales■Net sales■ Net sales■Segment profit■Segment profit■ Segment profit¥ 272 million (down 8.6% YoY)
¥7 million (¥(2) million in 1Q FY2021)¥12,651 million (up 121.1% YoY)¥(41) million (¥762 million in 1Q FY2021)

Copyright (C) 2021 HOPE, INC.

¥53 million (up 66.6% YoY)
¥ 8 million (up 71.6% YoY)07

Income Statement Highlights
1Q FY2021(Millions of yen)

Net sales

Results(non-consolidated)

1Q FY2022

Comp.

Results(consolidated)

6,052

Comp.

12,978〈7,167〉

YoY change+114.4%Gross profit

921

15.2%

123

1.0%

(86.5)%

SG&A expenses

234

3.9%

250

1.9%

+6.7%

Operating profit

686

11.3%

(126)

(1.0)%

Ordinary profit

676

11.2%

(136)

(1.1)%

Profit attributable toowners of parent

483

8.0%

(143)

(1.1)%* < > is figures using the gross recognition method.
HOPE, INC. is using the new revenue recognition standard starting in FY2022, so gross figures are not shown for FY2022.
Copyright (C) 2021 HOPE, INC.

08

Quarterly Sales• Sales increased 114.4% YoY because of an increase in the volume of electricity
sold in the Energy Business due to winning bids in FY2021.

12,97814,00053

Others
12,000Jichitai Works Business

10,370

Energy Business(Millions of yen)

10,000Up
114.4%
YoY

111

Advertising Business

8,000

5,445

6,000

2,551

2,808

2,100

2,352

386

426

1Q

2Q

1,665
14

1,263
0

32

80

4,000

2,000

6,052

23

6,355
46

5,666

9,569

4,622

5,721

5,267

5,934

431

742

298

359

372

3Q

4Q

15

12,65138

1Q(non-consolidated)

FY2020 (non-consolidated)

2Q(consolidated)

FY2021

Copyright (C) 2021 HOPE, INC.

3Q

(consolidated)

689

272

4Q

1Q

(consolidated)

FY2022(consolidated)09

Quarterly Operating Profit• The Advertising Business was profitable in the 1Q and the Jichitai Works Business is continuing
to perform well.
• The Energy Business cost of sales was as expected. (The 1Q FY2021 cost of electricity was lessthan expected.)
FY2020 (non-consolidated)(Millions of yen)

1Q

2Q

3Q

FY2022(consolidated)

FY2021

1Q

4Q

2Q

3Q

4Q

(non-consolidated)(consolidated)(consolidated)(consolidated)

1Q

Advertising
Business

(4)

13

51

244

(2)

25

59

245

7

Energy Business

19

79

149

808

762

(371)

(7,513)

197(41)

Jichitai WorksBusiness

(2)

2

(3)

42

5

7

1

44

8

Others

(2)

(1)

0

(7)

(9)

(8)

(8)

(21)

(23)

Adjustments

(66)

(76)

(74)

(150)

(68)

(80)

(75)

(85)

(77)

Total

(56)

16

122

937

686

(427)

(7,535)

381

(126)

(corporate expenses)*Standards for the allocation of corporate expenses were revised to more accurately show segment earnings.
As a result, segment earnings and corporate expenses have changed beginning with 1Q FY2020. The new standards have no effect on total earnings.

Copyright (C) 2021 HOPE, INC.

10

Sales by Segment

Advertising Business• Sales were lower but productivity continued to improve because of measures to achieve theproper size of this business; activities were strengthened for development of new services
900

Others800
700

SMART CREATION SERVICE

742

SMART RESOURCE SERVICE

94

689
77

(Millions of yen)

600
500
400

386
73

300

17

426
95
37

431

394

42

298

82

66
3

200

295

293

305

1Q

2Q

3Q

100

254

228

372

359

372

40

82

272

75

35

256

240

Down
8.6%
YoY

42
21
239

209

4Q

1Q

0

4Q

1Q

(non-consolidated)

FY2020 (non-consolidated)

2Q(consolidated)

FY2021

Copyright (C) 2021 HOPE, INC.

3Q

(consolidated)(consolidated)

FY2022(consolidated)

11Energy Business

Sales by Segment• The Energy Business has stopped bidding on new contracts and has switched to a stance of
reducing the level of future risk exposure.
• HOPE, INC.’s consolidated subsidiary will operate the electricity retail salesUpbusiness of the Energy Business.
121.1%
YoY

12,000(Millions of yen)

10,0008,000

12,651

6,000

9,569

4,000

4,622

2,000
0

1,263

1Q

2,100

2,352

2Q

3Q

4Q

5,721

1Q

(non-consolidated)

FY2020 (non-consolidated)■ Winning Bids
*As of confirmationof result of bids

FY2019FY2020＊
FY2021＊
FY2022＊

5,934

5,267

2Q

(consolidated)

3Q(consolidated)

4Q(consolidated)

1Q
FY2022(consolidated)

FY2021

1Q (Jul.-Sep.)

2Q (Oct.-Dec.)

3Q (Jan.-Mar.)

4Q (Apr.-Jun.)

Total

Not disclosed

Not disclosed

Not disclosed

Not disclosed

142
580
859
39

70
177
39

96
201
ー

Copyright (C) 2021 HOPE, INC.

337
426
ー

77
55
ー

12

Energy Business

Shortfall Imbalance Fees

• The high market price of electricity in 2020 winter and the January imbalance fee of about ¥6.5 billion(including tax) resulted in a higher cost of purchasing electricity.

Directpurchases

Supply of electricity (retail)

Procurement ofelectricity

Local governments(customers)Openmarketpurchases

Requirement to pay
imbalance fees

Energy company

How the energy business electricity(1) Direct purchases

Uses fixed-rate agreements with suppliers ofelectricity for the supply of electricity in the future.
The cost of this electricity is usually higher thanmarket prices.

(2) Open market purchases using the JEPXElectricity is purchased on the JEPX andprices are determined by seasonal factors
as well as the weather and other considerations.

Payment for electricity

Supplementary supply of electricity

How shortfall imbalance fees are triggered

When the demand for electricity at a customer exceeds the amount of electricity
provided by the retailer of electricity, the company distributing electricity covers
the shortfall. If this happens, the retailer of electricity is required to pay am
imbalance fee to the electricity distribution company to cover the cost ofelectricity purchased to cover the shortfall.
Electricity retailers purchase and sell electricity based on forecasts for the power
requirements of their customers. Imbalance fees are normally very small but can be
incurred at any time. The large imbalance fee in FY2021 occurred because of the
difficulty of open market electricity purchases and the effects of market prices and thetight supply of electricity on the cost of electricity.

Copyright (C) 2021 HOPE, INC.

13

High Market Price of Electricity in 2020 WinterEnergy Business• The high market price of electricity affected the cost of procuring electricity and the imbalance fee rate
and volume（

Higher open market price ofelectricity

JEPX Market Price of Electricity Period: Jan. 1, 2011 – Jun. 30, 2021
DA-24(¥/kWh)160（

Increase in the imbalance fee
rate and volume

HOPE, INC. Electricity Supply Imbalance Period: Jul. 1, 2019 – Mar. 31, 2021
(kWh)45,000,000*On Jan. 17, 2021, the Ministryof Economy, Trade and Industry
announced a ¥200/kWh cap forthe imbalance fee.

40,000,000

140

35,000,000

120

40,000,000

100

25,000,000*HOPE, INC.’s imbalance fees inJan. 2021:
Jan.1 - Jan. 16: About ¥4.8 billion
Jan. 17 - Jan. 31: About ¥1.7 billion

20,000,000

80

15,000,000

60

10,000,000

40

Mar . 2021

Jan . 2021

Nov . 2020

Sep . 2020

Jul . 2020

May . 2020

Mar . 2020

Jan . 2020

Jul . 2019

Jan. 1.2021

Jan. 1.2020

Jan. 1.2019

Jan. 1.2018

Jan. 1.2017

Jan. 1.2016

Jan. 1.2015

Jan. 1.2014(5,000,000)
Jan. 1. 2013

0Jan. 1. 2012

0
Jan. 1. 201120

Nov . 2019

5,000,000

Sep . 2019

(yen)
180

Big increasein
JEPX price(Reference) Ministry of Economy, Trade and Industry
Special approval for an imbalance fee rate cap of ¥200/kWh in response to the rapid increase in the wholesale market price of electricity was announced on Jan. 15, 2021.
https://www.meti.go.jp/press/2020/01/20210115007/20210115007.html

Copyright (C) 2021 HOPE, INC.

14

Jichitai Works Business

Sales by Segment• Consistently high levels of Jichitai Works advertisements and B-to-G solution orders
120

100

(Millions of yen)

80

Up
66.6%
YoY

60

111
80

40

20

14

23

32

53

46

38

15

0

1Q

2Q

3Q

4Q

1Q

(non-consolidated)

FY2020 (non-consolidated)

2Q(consolidated)

3Q(consolidated)

FY2021

4Q(consolidated)

1Q

FY2022(consolidated)*The first issue of Jichitai Works magazine was Dec. 22, 2017 and the magazine’s new design and format started in Jun. 2020.

Copyright (C) 2021 HOPE, INC.

15

Balance Sheet Highlights• Negative equity at the end of 1Q FY2022 was ¥1,701 million, about ¥796 million less thannegative equity of ¥2,498 million at the end of FY2021.
• YoY comparisons were used in prior years due to seasonal factors. In these highlights,
prior-quarter comparisons are shown to facilitate comparisons of negative equity.
4Q FY2021 (consolidated)(Millions of yen)

Results

1Q FY2022 (consolidated)

Comp.

Results

Comp.

ChangeCash and deposits

1,932

17.6%

2,542

20.7%

+609

Trade receivables and contract assets

7,336

66.9%

8,286

67.5%

+949

429

3.9%

321

2.6%

(107)

10,396

94.8%

11,54594.0%+1,148

10,964100.0%

12,279100.0%+1,314

Accounts payable-trade

11,290103.0%

10,925

89.0%

(365)

Short-term borrowings

950

8.7%

950

7.7%

+0

775

6.3%

+775

Inventories

Current assets

Non-current assets

Total assets

＊

567

5.2%

−

733

6.0%

+166

Current portion of bonds−

Current portion of long-term borrowings

366

3.3%

336

2.7%

(30)

12,880117.5%

109.7%

+589

100

0.9%

13,469Long-term borrowings

482

4.4%

410

3.3%

(71)

Non-current liabilities

582

5.3%

511

4.2%

(71)

Current liabilities
Bonds payable

Total liabilities

Total net assets

Total liabilities and net assets

13,462122.8%

10,964100.0%(2,498)(22.8)%

100

0.8%

+0

13,980113.9%+518

12,279100.0%+1,314(1,701)(13.9)%+796* Notes and accounts receivable-trade in 4Q FY2021* For information about FY2021 4Q figures, see the news release dated Aug. 24, 2021 concerning corrections to consolidated financial results for the fiscal year ended Jun. 30, 2021.
https://ssl4.eir-parts.net/doc/6195/tdnet/2019249/00.pdf
Copyright (C) 2021 HOPE, INC.

16
62

Measures to End Negative Equity• Many activities are under way to return to positive equity.
• Initiatives to increase equity and improve business operations have the goals of increasing
financial soundness and profitability.
■ Third-party allotment of stock and share acquisition rights
On August 27, 2021, HOPE, INC. used a third-party allotment to sell stock and the 11th share acquisition rights withan exercise price adjustment clause. At the end of September 2021, net assets totaled negative ¥1,701 million, ¥796
million less than negative ¥2,498 million at the end of June 2021.

■ Used spinoffs to establish subsidiaries; considering business/capital alliance or other measures forthese businesses (see page 19 for more information)■ Management improvements for stability of earnings(1) Reduce risk in the electricity retail sales business and take actions concerning business risk
• In the electricity retail sales business, HOPE, INC. will not submit bids for selling electricity to local governments until this business has clearlyreached the point where JEPX market risk no longer has a significant effect on the business operations of HOPE, INC.
(39 bids were submitted for electricity contracts during 1Q FY2022 and then the Energy Business stopped all bids for these contracts.)• Plan to conduct a thorough study to determine whether to continue the Energy Business, including the option of significantly downsizing this business.

(2) Use of a spinoff and absorption to transfer the electricity retail sales business to a subsidiary• On September 28, 2021, shareholders approved this spinoff and the spinoff is to take place on December 1, 2021.

(3) Profitability of existing and new businesses• 1Q FY2022 earnings of the existing Advertising and Jichitai Works businesses were as planned.
• Continuing activities for the launch of new businesses to create more sources of earnings.
(Reference) The Sep. 27, 2021 news release concerning measures to end negative equity

https://ssl4.eir-parts.net/doc/6195/tdnet/2026961/00.pdf

Copyright (C) 2021 HOPE, INC.

17

II. Topics

Copyright (C) 2021 HOPE, INC.

18

Topics 1. Transfer to a Holding Company Structure• Announced the conversion of the Advertising and Jichitai Works businesses into subsidiaries.
• Subsidiaries are to be established on December 1, 2021, by using a company split (simple spinoff).
• Considering alliances and other types of partnerships with other companies, including the sale ofsome stock of these subsidiaries, to procure funds for the entire group.
■ Purpose of becoming a holding company• The holding company structure will increase thespeed and agility of business operations, enable
the proper allocation of the group’s resources, andprovide a framework for overseeing financial
strategies and actions involving equity.
• The holding company will consider alliances andother types of partnerships with other companies.

■ Rights and obligations transferred to
the new subsidiaries• The two new subsidiaries will receive all assets,
liabilities, and contractual and other rights andobligations involving the Advertising and Jichitai
Works businesses.
• Employees of these businesses will continue to be
employed by HOPE, INC. and will be seconded tothese subsidiaries.

JICHITAI AD, INC.

HOPE ENERGY, INC.

JICHITAI WORKS, INC.

Name

JICHITAI AD, INC.

HOPE ENERGY, INC.

JICHITAI WORKS, INC.

Representative

Takayasu Tokitsu, CEO

Takayasu Tokitsu, CEO

Takayasu Tokitsu, CEOBusiness

Advertising Business

Energy Business

Jichitai Works Business

Capital¥10 million¥10 million¥10 million

EstablishedDec. 1, 2021 (scheduled)Oct. 22, 2020

Dec. 1, 2021 (scheduled)

Major shareholder

HOPE, INC. 100%

HOPE, INC. 100%

HOPE, INC. 100%

Sales (Pct. of total
HOPE, INC. sales)(FY2021)¥1,719 million (6.0%)¥26,493 million (93.1%)¥228 million (0.8%)* On September 28, 2021, shareholders approved a resolution for the spinoff of the electricity retail sales business andabsorption by HOPE ENERGY, a wholly owned subsidiary of HOPE, INC., on December 1, 2021 (tentative).

(Reference) For more information, see the news release dated Oct. 26, 2021 concerning the company split (simple spinoff) of the Advertising and Jichitai Works businesses and establishment of subsidiaries.
https://ssl4.eir-parts.net/doc/6195/tdnet/2035126/00.pdf

Copyright (C) 2021 HOPE, INC.

19

Topics 2. Started Monthly Disclosure of Energy Business Data
• Started monthly summary of Energy Business results (preliminary) in July 2021
■ Reason for monthly announcements• HOPE, INC. is reducing risk exposure in this business by suspending the submission of bids for new contracts and downsizing this business. In FY2022, the Energy Business is expected to continue to account for a significant percentage of
total sales due to contractual obligations to current customers. Monthly announcements will be made to provide detailed
and timely information.
FY2022

Forecast for avg. cost ofpurchasing electricity(Yen/kWh)

Actual avg. cost ofpurchasing electricity(Yen/kWh)

Avg. selling price ofelectricity(Yen/kWh)Electricity supplied(approx.)(million kWh)Jul. 2021

9.82

9.38

15.70

360

Aug. 2021

10.69

10.17

15.75

350

Sep. 2021

9.50

9.20

15.92

320

Oct. 2021

8.09

14.60

15.28

290

Nov. 2021

8.30

-

-

-

Dec. 2021

9.84

-

-

-

Jan. 2022

11.07

-

-

-

Feb. 2022

8.39

-

-

-

Mar. 2022

7.47

-

-

-

Apr. 2022

7.28

-

-

-

May 2022

7.65

-

-

-

Jun. 2022

7.75

-

-

-

(Reference) Notice Concerning Monthly Summary of Energy Business Results for the Fiscal Year Ending Jun. 30, 2022 (Preliminary Report), Oct. 7, 2021
https://ssl4.eir-parts.net/doc/6195/tdnet/2030462/00.pdf(Reference) Notice Concerning Monthly Summary of Energy Business Results for Oct. (Preliminary Report), Nov. 15, 2021

Copyright (C) 2021 HOPE, INC.

20

III. FY2022 Outlook

Copyright (C) 2021 HOPE, INC.

21

FY2022 Plan (Income Statement)• There are no earnings forecasts at this time because the rapid increase in JEPX market pricesthat started in October makes it difficult to determine a reliable estimate.
FY2020(Millions of yen)

Results(non-consolidated)

FY2021Results(consolidated)

Net sales

12,47028,444Gross profit

2,261(5,841)

SG&A expenses

1,240

1,053

Operating profit

1,020(6,895)

Ordinary profit

1,012(6,935)

Profit attributableto owners of parent

665(6,978)117.97yen＊(1,109.09) yen

Net income per share〈14,407〉〈34,615〉

FY2022(consolidated)

Plan

YoY change

34,850+22.5%* For information about FY2021 figures, see the news release dated Aug. 24, 2021 concerning corrections to consolidated financial results for the fiscal year ended Jun. 30, 2021.
https://ssl4.eir-parts.net/doc/6195/tdnet/2019249/00.pdf* For more information about the forecast, see the news release dated Nov. 15, 2021 concerning the FY2022 forecast for consolidated sales and earnings.
* < > is figures using the gross recognition method. HOPE, INC. is using the new revenue recognition standard starting in FY2022, so gross figures are not shown for FY2022.
* Net income per share is adjusted to reflect the 1-to-4 stock split effective on Jan. 1, 2020.

Copyright (C) 2021 HOPE, INC.

22

Assumptions Used for the FY2022 Plan
• For the FY2022 earnings forecast, out estimates for major variable items in the Energy Businessare as follows.
Estimated regional composition of energy to be supplied
Hokkaido

Tohoku

Tokyo

Chubu

Hokuriku

Kansai

Chugoku

Shikoku

KyushuTotal

12.34%

4.32%

26.48%

35.30%

1.51%

7.33%

8.91%

2.62%

1.19%

100.00%1 Cost of open market purchases of electricity■• Forecast for cost of electricity purchased on the JEPX
These estimates are weighted averages using the expected electricity prices and amount purchased bycustomers of HOPE, INC. in each region
Market priceforecast(Yen/including tax)

2021

2022

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

9.82

10.69

9.50

8.09

8.30

9.84

11.07

8.39

7.47

7.28

7.65

7.75

2 Fuel cost adjustment■• Forecast for the fuel cost adjustment
These estimates are weighted averages using the expected electricity prices and amount supplied tocustomers of HOPE, INC. in each region*The fuel cost adjustment allows revising electricity rates paid by customers in order to reflect an increase or decrease in the cost of imported fuel used at thermal power plants.
The adjustment is based on the difference between the average price of fuel (using 3-month trade statistics for prices of crude oil, LNG and coal) and reference fuel prices.

Weighted
average fuelcost adjustment(Yen/including tax)

2021

2022

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

(2.73)(2.65)(2.57)(2.46)(2.38)(2.29)(2.21)(2.13)(2.06)(1.91)(1.92)(1.91)

Copyright (C) 2021 HOPE, INC.

23

Consistent Sales Growth
40,00034,85035,00028,444〈34,615〉

25,00020,00012,47015,000〈14,407〉

10,000

3,654

5,000

512

695

635

1,142

1,592

1,774

2,269

〈3,862〉

Non-consolidated

FY
2
(P 02
la 2
n)

20
21
FY

20
20
FY

20
19
FY

8
01
FY
2

17
20
FY

20
16
FY

5
01
FY
2

20
14
FY

01
3
FY
2

20

12

0

FY

(Millions of yen)

30,000Consolidated* FY2014 was an irregular nine-month period because of a change in fiscal year-end.
* < > is figures using the gross recognition method.
* For information about FY2021 figures, see the news release dated Aug. 24, 2021 concerning corrections to consolidated financial results for the fiscal year ended Jun. 30, 2021.
https://ssl4.eir-parts.net/doc/6195/tdnet/2019249/00.pdf

Copyright (C) 2021 HOPE, INC.

24

FY2022 Business Segment Sales Plan

Jichitai Works Business
40

Energy BusinessApprox. ¥34.8 billion

Advertising Business
35

Approx. ¥28.4 billion

Approx. ¥0.43 billion〈34.6〉

30(Billions of yen)

Approx. ¥0.22 billion
25

20

Approx. ¥32.87 billion
15

Approx. ¥26.49 billion〈32.66〉10

50

Approx. ¥1.71 billion

Approx. ¥1.53 billion

FY2021

FY2022(Plan)* 〈 〉 is figures using the gross recognition method.

Copyright (C) 2021 HOPE, INC.

25

IV. Business Environment and
Growth Strategies

Copyright (C) 2021 HOPE, INC.

26

Advertising Business

Market Summary• HOPE, INC. created a new market with its Advertising Business, the company’s original activity,and has provided advertising services to local governments for about 16 years.
• HOPE, INC.’s share of this market is about 10.8%.
The advertising market in Japan

Approx. ¥5.3 trillion *1
Approx. ¥13.8 billion *2
Approx. ¥1.5 billion *3

Target market
About 10.8%of the target market*1 Source: Survey of Selected Service Industries (May 2021), Ministry of Economy, Trade and Industry*2 Market size is estimated by HOPE, INC. using current advertising rates received and based on theassumption that SR/SC services will be used at a level reflecting the populations of municipalities.
*3 FY2021 Advertising Business sales (excluding contract production of public info publications)

Copyright (C) 2021 HOPE, INC.

27

Advertising Business

Goals for FY2022• Improve profitability by positioning this business as a profit-generation business and achieving theproper size of this business• Aim for consistent earnings by raising productivity per employee while holding sales steady at an
appropriate level■ Gross profit per person in the Advertising BusinessNet sales *1

Gross profit per person *2

2,500■ HOPE, INC. already has more than 10% of

15,0002,188

the local government ad market in Japan

2,051

with annual revenue of about ¥13.8 billion.

2,000

1,810

→ The goal is a higher proﬁt margin rather■ Reduce the seasonality of this business tobuild a stronger proﬁt structure by cutting
expenses and raising eﬃciency.

■ To increase proﬁtability, improve productivity with measures targeting the new perfor-(Millions of yen)than sales growth.

1,546

●

1,500

●
●

1,000

6,893

●

9,510

10,912

12,000

●

1,400

9,000

8,166

6,942

6,000

(Thousands of yen)

Strategies for a Mature Market

3,000

500

mance indicator of gross proﬁt per person

0*1 Advertising business sales (excluding contract production of public information publications)*2 Number of advertising employees is the average for every year and excludes advertisement designers

Copyright (C) 2021 HOPE, INC.

FY2018FY2019FY2020

FY2021

FY2022028

Energy Business

Market Summary• Rapid growth since the launch of this business in 2018 that used HOPE, INC.’s expertise involving
bidding on public-sector contracts• Expect electricity supplied to reach a record high in FY2022, but have stopped bidding on new
contacts (see page 30 for more information)
Japan’s electricity market

Approx. ¥15 trillion *1
Electricity sales to local govts.

Approx. ¥1 trillion *2

Target market
HOPE, INC. serves approx.

Approx. ¥54.0 billion *3 5.4% of the target market*1 Source: Electricity and Gas Market Surveillance Commission*2 HOPE, INC. estimates using "Statistics on Energy Consumption” by Agency for Natural Resources
and Energy*3 Expected total sales of energy supplied for contracts received in FY2021(Includes one-year of multi-year contracts and excludes fuel adjustments and renewable energy fees)

Copyright (C) 2021 HOPE, INC.

29

Energy Business

Goals for FY2022• Downsize operations to reduce business risk exposure■ Assumptions
1) Electricity prices are usually low in the spring and fall (including October) but in 2021, JEPX prices were higher than
expected.
2) HOPE, INC. was unable to purchase the expected volume of electricity by using direct one-to-one transactions
because payment terms did not match the HOPE Group’s desired terms.
3) There are concerns about a tight supply of electricity during the winter of 2021-2022 too.

■ Continuation of the suspension of submitting bids
The Energy Business is a large percentage of total sales. Due to the substantial market risk in this business, HOPE, INC.
will not submit bids in the electricity retail sales business for new electricity supply contracts with local governments inorder to improve the soundness of business operations. This suspension will continue until it becomes clear that thismarket risk will no longer have a significant effect on business operations.

■ Purpose of the spinoff of the electricity retail sales business to HOPE ENERGY, INC.
• The electricity retail sales business will continue at HOPE ENERGY and actions will be taken to reduce risk exposure by
downsizing this business in a manner that reflects the business climate.
• The shift to a group management structure with more speed and flexibility will better facilitate the timely and proper
management of risk and the best possible allocation of the HOPE Group’s resources.

(Reference) For more information, see the Sep. 27, 2021 news release concerning measures to end negative equity. https://ssl4.eir-parts.net/doc/6195/tdnet/2026961/00.pdf
For more information, see the Aug. 11, 2021 news release concerning the spinoff of the electricity retail sales business. https://ssl4.eir-parts.net/doc/6195/tdnet/2014535/00.pdf

Copyright (C) 2021 HOPE, INC.

30

Jichitai Works Business

Market Summary• Substantial public-sector demand and still considerable growth potential
The market for promotions targeting local governments still has
much more potential, including public-private sector matching
and measures to become more competitive
Market for promotions
targeting local govts.

15.2 billion

Local govt.

Approx. ¥Public-sector demand(except national govt., construction)

Companies

Approx. ¥ 8.68 trillion * 1
Approx. ¥1.52 trillion * 2

Approx.

¥0.22 billion*3

1%

Potential market

Portion for companies operating nationwide
Assumes about 1% is used for promotional activities(market for promotions targeting local governments.)

Approx. ¥ 15.2 billion*1 Calculated by HOPE, INC. using Summary of Guide to Contracts in the Public Sector – FY2018,
The Small and Medium Enterprise Agency*2 HOPE, INC. estimates based on FY2018 Administrative Project Review, Ministry of Internal Affairs andCommunications*3 FY2021 Jichitai Works Business sales

Copyright (C) 2021 HOPE, INC.

31

Jichitai Works Business

Goals for FY2022

Become a link for public-private sector collaboration and ties
among local governments based on the concept of energizing“experiences and people” at local governments.

Monitor/collect info
Local govt.

Monitor･ Social issues･ Need for the useof private sector
partners

Contribute tomarket growth

Jichitai Works

Need for ways
to contact local
governments

Companies

Provide many types of services• Broad range of activities using the Jichitai Works brand• More matching by using the internet, telemarketing and other methods

Copyright (C) 2021 HOPE, INC.

32

Jichitai Works BusinessBusiness Strategy

Business strengthening, support and creation made possible by the local government database

Local govt.

Information
Jichitai Works

Jichitai Works

Companies

Sales

Information

Jichitai Works Web

Machiiro

Sales

B-to-G solutions

Open data

Partnerships
with regional banks

Partnerships
with local govts.

Collect and store data
Establish and enlarge local govt. databases
Individuals

Organizations• Budgets• Issues, needs• Information about local govt.
and national govt. employees

Copyright (C) 2021 HOPE, INC.

33

Jichitai Works BusinessBusiness Strategy• The government employee platform concept :Enlarge business operations to cover the government employee sector in order to become theleader in businesses and services for local governments.
• The government employee sector will be a growing market for the Jichitai Works Business.

Current core competence(local govt. relations)・・・

Local govt.

Govt. employees

Local govt.

Govt. employees

Local govt.

Govt. employees

The govt. employee platform concept

Core competence enlargement
Copyright (C) 2021 HOPE, INC.

・・・
Market sectors
covered by the
Jichitai WorksBusiness

34

Reexamination of the HOPE NEXT 3 Medium-term Management Plan
• Reestablish HOPE NEXT 3 based on the elimination of negative equity• The goal is to eliminate negative equity by the end of June 2022

■ Assumptions• The original medium-term plan made the Energy Business a large share of sales and earnings.
• We reexamined the business portfolio, including new businesses, to establish a strategy for growth.

■ Timing for establishing a new plan
• In FY2022, we are focusing on making steady progress with measures to eliminate negative equity andachieving this goal by the end of June 2022.
• A new medium-term plan will be established after equity becomes positive.

■ Other items• There is no change at this time in the 2020 VISION goals for FY2030: sales of ¥100 billion, operating
profit of ¥10 billion, and a business portfolio with at least 10 services.
• There are no revisions to the expected business environment changes or business policies regarding theAdvertising Business and the Jichitai Works Business.
(Reference) Information about the Medium-term Management Plan before the reexamination is in “Medium-term Management Plan HOPE NEXT 3” announced on Aug. 11, 2020.
https://ssl4.eir-parts.net/doc/6195/tdnet/1873672/00.pdf

Copyright (C) 2021 HOPE, INC.

35

FY2022 Investor Relations Activities• Plan to continue increasing the number of meetings with institutional investors by using online
meetings and expanding English-language disclosure activities.
• Also plan to hold meetings during FY2022 when requested.

■ Number of institutional investor meetings
240
220
200
180
160
140
120

233

100
80
60

82

40
20
0

9

6

FY2018FY2019Goal:
12FY2020

FY202130meetings

FY2022*Includes online meetings and telephone calls

Copyright (C) 2021 HOPE, INC.

36

V. 2020 VISION

Copyright (C) 2021 HOPE, INC.

37

Expansion of Core Competence• Enlarge local government relations, HOPE, INC.’s core competence, to encompass the entire
government employee sector.

Current core competence(local govt. relations)・・・

Local govt.

Local govt.

Local govt.

Govt. employees

Govt. employees

Govt. employees・・・The govt. employee platform concept

Core competence enlargement
Copyright (C) 2021 HOPE, INC.

38

Expansion of Core Competence

Business domain
expansion

Govt. employees

Local govt.

Use the enlargement of the corecompetence for the diversificationof business activities in a domain
expanded to include thegovernment employee sector

Business domain
expansion

Become the leader in businesses andservices for local governments
Copyright (C) 2021 HOPE, INC.

39

Positioning of Business Units• Enlarge every business domain and increase actions for the expansion of HOPE, INC.’s corecompetence.
Measures for providing value
Additional
local govt. revenue

Enlargement of targeted domains

Local
govt.

Public-private sector
collaboration

Ads in public info
publications, banner ads, etc

Local govt. DX…

Jichitai Works

Machilet

SMART FR CONSULTING

B-to-G
Solutions

Machiiro

Jichitai Works

Jichitai Works Web

Govt.
employees

The Jichitai Works Free Name Card service

The govt. employee platform concept

Copyright (C) 2021 HOPE, INC.

40

2020 VISIONF Y2030
Net sales
Operating profit
Services¥

100 billion¥ 10 billion
10 services

Copyright (C) 20202021 HOPE, INC.

41

2020 VISION Initiatives• Start and implement initiatives for accomplishing the FY2030 goals of the 2020
VISION: Sales of ¥100 billion, operating profit of ¥10 billion and a business portfoliowith at least 10 services.

Advertising Energy

100

JichitaiWorks
Newbusiness¥¥28.4
billionNew
businessbillionNew
business

ActionsNewbusinessNewbusiness

FY2021

FY20303 services

More than 10 services

Copyright (C) 2021 HOPE, INC.

• Improve profitability ofexisting businesses• Develop new businesses• Use all existing businesses
as a base for new businesses• M&A• Financial and investment
strategies

42VI. Appendices

Copyright (C) 2021 HOPE, INC.

43

Business Segments and Services

Advertising Business
SMARE RESOURCE SERVICESMART CREATION SERVICE

Ads in public info publications,banner ads, etc.

MachiletEnergy Business

Jichitai Works Business
Jichitai Works

Jichitai Works Web

B-to-G Solutions

Jichitai Works

Machiiro*Beginning with FY2020, Machiiro has been moved from the Jichitai Works segment to others.

Copyright (C) 2021 HOPE, INC.

44

Advertising BusinessCorporate Philosophy

Local govt.
assetsProviding new value to citizens
through local governments

Utilization•Public info publications,
local government websites

Additional
local govt. revenue•Use of media space•Information distributed to residents■ Value provided
Local gov t.

•Free joint publications by local
governments and HOPE, INC.

A sourceof revenue

Copyright (C) 2021 HOPE, INC.

Opportunities
for PR

Companies

45

A new source of revenue for local governments
Local governments sell ad spacein their publications■ Business model

Payment
for ad space

Payment
for ad space

広報

この文章はダミーコピーです
本来の文言とは全く違った内

く す る た め 使 用 し て い ま す︒
容を記載しています︒

お 読 み に な ら な い で 下 さ い︒
この文章はダミーコピーです

構成を分かりやすくするため
使 用 し て い ま す︒本 来 の 文 言
お 読 み に な ら な い で 下 さ い︒
使 用 し て い ま す︒本 来 の 文 言

構成を分かりやすくするためとは全く違った内容を記載しとは全く違った内容を記載しコピーですお読みにならないて い ま す︒こ の 文 章 は ダ ミ ーて い ま す︒こ の 文 章 は ダ ミ ー
で 下 さ い︒こ の 文 章 は ダ ミ ー
コピーですお読みにならない

コピーですお読みにならないで 下 さ い︒構 成 を 分 か り や すで 下 さ い︒こ の 文 章 は ダ ミ ー
で 下 さ い︒構 成 を 分 か り や す

コピーですお読みにならない
く す る た め 使 用 し て い ま す︒

く す る た め 使 用 し て い ま す︒
容を記載しています︒
本来の文言とは全く違った内

本来の文言とは全く違った内
この文章はダミーコピーです

で 下 さ い︒こ の 文 章 は ダ ミ ー

コピーですお読みにならないて い ま す︒こ の 文 章 は ダ ミ ーて い ま す︒こ の 文 章 は ダ ミ ーとは全く違った内容を記載し

使 用 し て い ま す︒本 来 の 文 言

構成を分かりやすくするため

お 読 み に な ら な い で 下 さ い︒

この文章はダミーコピーです

容を記載しています︒

お 読 み に な ら な い で 下 さ い︒
構成を分かりやすくするため
使 用 し て い ま す︒本 来 の 文 言

コピーですお読みにならないとは全く違った内容を記載しで 下 さ い︒構 成 を 分 か り や すXXXX容を記載しています︒

この文章はダミーコピーです

この文章はダミーコピーです

お 読 み に な ら な い で 下 さ い︒

お 読 み に な ら な い で 下 さ い︒

構成を分かりやすくするため構成を分かりやすくするため

使 用 し て い ま す︒本 来 の 文 言

使 用 し て い ま す︒本 来 の 文 言とは全く違った内容を記載しとは全く違った内容を記載しこの文章はダミーコピーです

容を記載しています︒て い ま す︒こ の 文 章 は ダ ミ ーて い ま す︒こ の 文 章 は ダ ミ ー

この文章はダミーコピーです

コピーですお読みにならない

コピーですお読みにならない

お 読 み に な ら な い で 下 さ い︒

で 下 さ い︒こ の 文 章 は ダ ミ ー

お 読 み に な ら な い で 下 さ い︒

構成を分かりやすくするためコピーですお読みにならない

構成を分かりやすくするため

使 用 し て い ま す︒本 来 の 文 言

で 下 さ い︒構 成 を 分 か り や すで 下 さ い︒こ の 文 章 は ダ ミ ーとは全く違った内容を記載し

使 用 し て い ま す︒本 来 の 文 言て い ま す︒こ の 文 章 は ダ ミ ー

く す る た め 使 用 し て い ま す︒

コピーですお読みにならない

コピーですお読みにならない

本来の文言とは全く違った内で 下 さ い︒構 成 を 分 か り や すで 下 さ い︒こ の 文 章 は ダ ミ ーとは全く違った内容を記載しコピーですお読みにならない

く す る た め 使 用 し て い ま す︒

で 下 さ い︒構 成 を 分 か り や すて い ま す︒こ の 文 章 は ダ ミ ー

く す る た め 使 用 し て い ま す︒
容を記載しています︒

本来の文言とは全く違った内コピーですお読みにならない

コピーですお読みに本来の文言とは全く違った内た内容を記載しています。この文章はダミー

で 下 さ い︒こ の 文 章 は ダ ミ ー

ないで下さい。構成を分かりやすくするた

コピーですお読みにならない

この文章はダミーコピーですお読みにならで 下 さ い︒構 成 を 分 か り や す

コピーですお読みにならないで下さい。

く す る た め 使 用 し て い ま す︒

め使用しています。本来の文言とは全く違っ

本来の文言とは全く違った内ないで下さい。構成を分かりやすくするた容を記載しています︒

46
Copyright (C) 2021 HOPE, INC.

Ad
Othersた内容を記載しています。この文章はダミー

株式会社◯◯◯

2021

この文章はダミーコピーですお読みになら☎000-000-0000

Ad■■■■■■■■■■■■■■■■■■

11■ Ad in a public info publication■ Examples of media

Companies

Saleof ad space
Local gov t.

Purchaseof ad space

め使用しています。本来の文言とは全く違っ

Payslips forgovernment employees
WebsitebannerPublic info
publications

SMART RESOURCE SERVICE
Advertising Business 1

Advertising Business 2

SMART CREATION SERVICE (Machilet)

Production and supply of local government
pamphlets for various fields with space for ads

Local gov t.

Free joint production of pamphlets
with even more useful info

Agreement

Saleof ad space

Companies■ Business model
Production
and supplyof pamphlets■ Examples of pamphlets■ Ad in a pamphlet (child care information)
Content(child careinformation)

Child care

Empty houses

Payment
for ad space

Senior care

Advertisement(monetize space)

My ending
OthersCopyright (C) 2021 HOPE, INC.

47

Advertising BusinessContracts with Local Governments
and Number of Publications Issued

SMART RESOURCE SERVICESMART CREATION SERVICE (Machilet)(Contracts)(Publications)

1,000

462

500

839
800

400

309

280

300

694

685

572

600

258

200

400

100

200

30

17
0

Plan
491

(Issued in 1Q)

20
22
1Q

FY

21
20
FY

20
20
FY

20
19
FY

20
18

1Q

FY

FY

20
22

20
21
FY

20
20
FY

20
19
FY

FY

20
18

0

*For two or more different contracts with the same local government, each contract is counted separately.
*The SMART CREATION SERVICE includes conventional pamphlets (Machilet) as well as Clear File and other special publications issued in each fiscal year.
A revised definition is used for the actual number of these publications from FY2018 and these figures have been revised accordingly.

SMART FR CONSULTING SERVICE

Two local governments are using this new service that was launched in July 2021.
(Reference) For more information, see the news release dated Jul. 29, 2021 concerning the start of providing this new consulting service for Fukuoka city; estimated effect of advertising
revenue will contribute to effective and sustainable business operations of local governments.
https://ssl4.eir-parts.net/doc/6195/tdnet/2005240/00.pdf

Copyright (C) 2021 HOPE, INC.

48

Advertising Business

Main Business Characteristics

SMART RESOURCE SERVICESMART CREATION SERVICE (Machilet)

1 Bids used to purchase products

1 Most production and sales at the sametime of the year

•Big swings in bids (cost of purchases)•Risk of inability to purchase a sufficient volume due to

The production and sales period starts after signing contracts

bids of other companies, etc.

2 Seasonal nature of purchases andinventory risk

with local governments

2 Large pct. of sales in the fourth quarter
About 70% of publications are issued between Apr. and Jun.

▶ Most sales and cost of sales are recorded in the fourth quarter•Most SMART RESOURCE SERVICE purchases are

single transactions for an entire year (Apr. to Mar.),resulting in risk for holding large inventories

3 Effect on the next fiscal year
•Most purchases using bids submitted during thepeak season for government contract bids will havean effect on the next fiscal year all the way to Mar.

250

Publications issued in FY2021

200

Production and sales period

150
100
50

0

Jul. Aug. Sep. Oct.
2020

Copyright (C) 2021 HOPE, INC.

Nov. Dec. Jan. Feb.

Mar. Apr. May. Jun.
2021

49

Energy BusinessCorporate Philosophy

Local govt.
electricity use

Providing new value to citizens
through local governments

New electricity
service

Lower cost ofelectricity■ Value provided
Local gov t.

Cost reduction

Copyright (C) 2021 HOPE, INC.

50

Energy BusinessStart of the electricity
sales business

GENEWAT uses the new perception of “electricity as a
generic product” for supplying electricity at a lower price inorder to help local governments reduce costs.

Electricity• Sale of electricity*Business does not include

generation and distribution

Local govt.

■ Business model
Payments■ GENEWAT users(mainly local governments)

Hospitals• HOPE, INC. posts sales/cost of sales
based on monthly utilization

SewageplantsCopyright (C) 2021 HOPE, INC.

Schools

City halls

•••

51

Energy Business

1

Main Business Characteristics

Contracts are received by submitting bids
• Business may be lost to competing bids of other companies when new bidding takes
place every year

2

Vulnerability to the economy and weather• Electricity sales may vary depending on the health of the economy, unseasonable
summer or winter weather, and other weather events• Wholesale prices of electricity may vary depending on the cost of buying electricity, thecost of fuel, and the balance between the supply and demand of electricity

3

A low-cost business• When determining bids, the Energy Business utilizes bidding expertise acquired overmany years in the Advertising Business

Copyright (C) 2021 HOPE, INC.

52

Jichitai Works BusinessCorporate Philosophy

Local govt.

Providing new value to citizens
through local governments

Use the private sector
to solve issues

Opportunity
to collaborate
with public sector

Companies

Public-private sector collaboration
Copyright (C) 2021 HOPE, INC.

53

A Government Magazine
Jichitai Works Business 1
with New Info and Ideas

Jichitai Works• Use of advertisements to monetize publications• Starting in FY2022, increased to three the types of publications with all advertisements by a single
advertiser; selling these publications as a B-to-G solution
A HOPE, INC. publication
with useful info and ideas

Local gov t.

Collect
information

Jichitai Works

Interaction
with local govt.

Companies

for the jobs of local
government employees

Provideinformation■ Issued six times every year 《Standard Jichitai Works》
1 One of the largest circulations in Japan

A comprehensive info magazine for local government
employees; circulation of up to 70,000, one of the largest inJapan in this category

2 Extensive coverage
Distributed at no charge to 1,788 municipalities and all 47
prefectural governments

3 Upgrading sharing of knowledge
Magazines include examples of innovative ideas, a variety ofknow-how and other content for improving government
services throughout Japan

Copyright (C) 2021 HOPE, INC.

Payment
for ad space■ Issued as needed(Special issues / PICKS / INFO)
Publications with a single advertiser
Layout created specifically for eachadvertiser; three types depending on thenumber of pages■ Jichitai Works Web
Articles in the printed editionof Jichitai Works magazine arealso posted on the internet.

54

Jichitai Works Business

Jichitai Works Magazine Issues• In FY2021, the number of pages increased with every issue and content of the magazines was
expanded and upgraded.
• In FY2022, we are increasing the staff of the Jichitai Works Business with the goal of raising thenumber of magazines issued while maintaining the high quality of these publications.
11(Issue)
12

10

8

6

•Tourism/Foreign Tourist
Edition Vol. 2•Disaster Readiness/Crisis
Management Edition Vol. 2•Education and ICT Editionof which issued(（内1Q実績
in 4Q:
1Q: 2：1）)

2

Special editions•Tourism/Foreign Tourist
Edition Vol. 3

Topic-specific editions•Disaster Readiness/Crisis
Management Edition Vol. 3Standard editions

5

5of which issued(（内1Q実績
in 4Q:
1Q: 1
2：1）)•Special edition forgovernment employees

1

4

2

Others4

4
1

0

FY2020

FY2021
Copyright (C) 2021 HOPE, INC.

1Q FY2022

55

Jichitai Works Business 2

B-to-G Solutions• In the B-to-G solutions, local government relationships are used for surveys to identify needs
and for holding seminars, and other activities.
In addition, sales promotion and other promotion fees from companies and a revenue sharing
model will be used for monetization.
Support for marketingand promotional
activities of companies
with products andservices for local
governments

Data collection

Local gov t.

Reports, other info

B-to-G
solutions
Seminars, needs surveys,
other services

Companies

Requests for assistance■ Contracted service orders received• Seminars for local government employees and other service
Use database
to attract customers• Direct mail marketing• Telemarketing• Others

Identify needs* B-to-G solutions has two components: (1) B-to-G promotions (formerly B-to-G marketing), which receives orders that generate promotion fees, and (2) B-to-G comprehensive support,
which receives orders with a revenue sharing structure.

Copyright (C) 2021 HOPE, INC.

56

Jichitai Works

Jichitai Works Business 3

Jichitai Works HAxSH• A joint assistance platform for local governments and companies

Jichitai Works

Companies
providing services

Register their own
services

Service searches andexaminations

Sharing of informationof person who
downloaded their
documents

Download
documents about
services of interest

Local govt.
personnel

Payment of fees

Register contact
and other
information

Collaboration with local
governments creates newopportunities

Solve problems byusing private-sector
services
Copyright (C) 2021 HOPE, INC.

57

An App Linking Local
Jichitai Works Business 4
Governments and Residents

Machiiro• The app provides the latest info from registered local governments by giving users access topublic info publications of local governments nationwide.
• Distribution of content for local governments and regions

Local govt.

UploadAgreement

Residents

Machiiro

Distribution of
governments
information
using an app*Machiiro screen sample

743,735

cumulative downloads

945 cumulative

local government contracts

Local governments
share of about

52.9%*Total as of Sep. 30, 2021

Copyright (C) 2021 HOPE, INC.

58

Additional Local Government Revenue

Since HOPE, INC.’s inception, the Advertising Businesshas generated revenue of about ¥8.83 billion for clients•SMART RESOURCE SERVICE has paid local governments
about ¥ 7.94 billion•Machilet has reduced local government costs byabout ¥ 0.88 billion(From HOPE, INC.’s inception through 1Q FY2022)

32.8

Cost reduction of about ¥billionsince the start of the Energy Business(Estimated cost reduction during the entire length of all current contracts)

Copyright (C) 2021 HOPE, INC.

59

Main Shareholders■ Number of shares and shareholders■ Top 10 shareholders

Number ofshares held

27,950,000 shares

No.

Number of shares issued

9,360,100 shares

1

E.T. Co., Ltd.

1,340,000 shares

Number of shareholders(with voting rights)

5,895

2

Takayasu Tokitsu

1,027,400 shares

3

BNY GCM CLIENT ACCOUNTJPRD AC ISG (FE-AC)

418,455 shares

4

GOLDMAN SACHS INTERNATIONAL

348,897 shares

5

MACQUARIE BANK LIMITEDDBU AC324,500 shares

6

Individual shareholder

247,800 shares

7

Custody Bank of Japan, Ltd.
(Trust Account)

234,400 shares

8JAPAN SECURITIES FINANCE CO., LTD.

203,200 shares

9

Triple One Investment Partnership

184,600 shares

10

Individual shareholder

160,200 shares

Total number of authorized shares■ Shareholder distribution by category

Other Japaneseentities

4.7%

Overseas
entities

16.0%

Company
executives*

26.9%
Financial
institutions/securities
companies

6.7%

Individuals,
others45.7%

Name of shareholders(As of Sep. 30, 2021)* Includes their private asset managers

Copyright (C) 2021 HOPE, INC.

60

Stock Information
PeriodJun. 15, 2016 to Sep. 30, 2021

IPO price¥350

Initial price¥805 (Jun. 15, 2016)

Highest price since IPO*

¥7,910 (Nov. 11, 2020)

Lowest price since IPO*

¥220 (Dec. 25, 2018)

ROE

FY2015FY2016FY2017FY2018FY2019FY2020

23.7%

23.9%

3.2%

(25.4)%

15.7%

75.4%

FY2016FY2017FY2018FY2019FY202027.9x116.3x

32.3x

30.5x

PER*

■ Stock price (Jul. 1, 2018 to Sep. 30, 2021)
9,000
8,000

Dec. 10
Announcement of
1-to-4 stock split

6,000

4,000
3,000
2,000

Mar. 26
Announcement of participationin the private-sector
Nov. 5 trainee program of theAnnouncement of AI for forecasting market prices of electricity
city of Shijonawate

May 26
Announcement of Jichitai Works HAxSH

7,000

May 17
Announcement of the 3rd shareholder benefits
Aug. 9Earnings announcement
Sep. 3
Changed names ofbusiness segments and services

May 27
Announcementof upward
earnings
forecast

0

FY2019

May 21
Announcement ofpurchase of treasury sharesFeb. 17
HOPE, INC.’sstockapproved for
margintradingJul. 27
Announcementof upward
Feb. 6earnings forecast
Commemorative
Aug. 11
dividend
Earnings and medium-term
management plan announcement

Jul. 1The Media Business was renamed
the Jichitai Works BusinessAug. 11
Announcement ofabsorption-type company split
Sep. 27
Announcement of actions
for ending negative equity

Sep. 14
Announcement Dec. 23of establishment A private-public sector allianceof a subsidiary agreement with the city of Ogori (Fukuoka prefecture)

FY2021
Jun. 30, 2020

Copyright (C) 2021 HOPE, INC.

Jun. 15
Launched SMART FR CONSULTING SERVICE
Jun. 17
Launched the Jichitai Works
Free Name Card service
Jun. 21
Started providing physician recruiting
support for COVID-19 vaccinations

Sep. 26
Renewal of
corporate
logo

FY2020Jun. 30, 2019

Jun. 29
Renewal of
Jichitai Works

Apr. 30
Issued the Ninth Share Acquisition Rights andunsecured bonds through a third party allotment

May 13
Announcement of
upward earnings forecast

Aug. 8
Earnings
announcement

1,000

FY2021* Calculated based on the stock price at the end of each fiscal year.

* Including stock prices during trading hours.
* Stock prices are adjusted to reflect a 1-to-4 stock split.

5,000

FY2021

FY2022
Jun. 30, 2021

Sep. 30, 2021

61

HOPE, INC. Major Media Exposure
Date

Summary

Date

Summary

Jun. 7, 2016

Investment Information – New IPO Stocks,
Nihon Keizai Shimbun

Aug. 7, 2017

Information about HOPE, INC. in Japan Digest,
Nihon Keizai Shimbun

Sep. 1, 2016

Included in an article in the Oct.
issue of Project Design magazine

Jan. 18, 2018

Information about HOPE, INC’s electricity sales businessin the economy section of the Yomiuri Shimbun

Sep. 25, 2016

Information about HOPE, INC. on the TBS TV
program Gacchiri Monday!

Feb. 15, 2018

Information about the Machiiro app forchecking how much money is coming,
Nonstop TV program of Fuji TelevisionNov. 7, 2016

Interview with the HOPE, INC. president inMichishirube, Nihon Keizai Shimbun

Apr. 23, 2018

Information about HOPE, INC. on the TV Asahi
Bakumon Fund! Money Success Graph

Jan. 10, 2017

Interview with the HOPE, INC. president in
Dash Venture, Nihon Sangyo Shimbun

May 21, 2018

HOPE, INC. president featured in a daily column on
business executives in the Nihon Keizai Shimbun

Jan. 16, 2017

Interview with the HOPE, INC. president inFuji Sankei Business i.

Oct. 31, 2018

Information about a HOPE, INC.’s Halloween event on
NHK TV programs Rokuichi! Fukuoka, NHK News 7,
News Watch 9, and News 11

Feb. 23, 2017

Interview with the HOPE, INC. president in
God of Happiness Diary, Kabushiki Shimbun

Dec. 1, 2019

Information about HOPE, INC. in an article
about innovative companies in Nikkei Veritas

Mar. 24, 2017

Included in The First Companies 2017,an article about newly listed companies

Jan. 31, 2020

Information about the condolence guidebookof HOPE, INC’s Machilet, Chunichi Shimbun

May 12, 2017

Included in Gatchiri Monday! The Secret of
Making Money on 40 Little Known Companies

Sep. 4, 2020

Interview with the HOPE, INC. president on the Nikkei
CNBC program Hiru Express

Aug. 3, 2017

Interview with the HOPE, INC. president in CEOs Explain
Management Strategies, Nikkei Sangyo Shimbun

Copyright (C) 2021 HOPE, INC.

62

Disclaimer
Information in this presentation includes forward-looking statements that are based on thecurrent outlook, forecasts and assumptions vulnerable to risk factors. As a result, thisinformation incorporates uncertainties that may cause actual performance to differ from thesestatements.

Risk factors and uncertainties include economic trends in Japan and other countries, such aschanges in industries and markets, interest rates, and foreign exchange rates.

HOPE, INC. has no obligation to update or revise for ward-looking statements in thispresentation even in the event of new information or events.

- IR contact HOPE, INC.

E-Mail: ir@zaigenkakuho.com
URL: https://www.zaigenkakuho.com/en/ir

Copyright (C) 2021 HOPE, INC.

63