Summary of Consolidated Financial Statement
for the Fiscal Year Ended September 30, 2020 [IFRS]October 29, 2020
Listed Market: TSE

SEPTENI HOLDINGS CO., LTD.
Stock Code: 4293 URL: https://www.septeni-holdings.co.jp/en
Representative: Representative Director, Group President and Chief Executive Officer Koki Sato
Contact Person: Corporate Planning Department Manager Tei Go, Telephone: +81-3-6857-7258
Anticipated General Annual Shareholder Meeting Date: December 22, 2020
Anticipated Dividend Payment Date:
November 30, 2020
Anticipated Financial Report Filing Date:
December 22, 2020
Supplemental Earnings Presentation Materials:
Available
Earnings Presentation Meeting:
Held for institutional investors, analysts, media(All figures of less than 1 million yen are rounded down to the nearest digit)

1. Consolidated Financial Results for the Fiscal Year Ended September 30, 2020 (From October 1, 2019 to September 30,
2020)(1) Consolidated Earnings(% figures represent year-over-year change)
Revenue

Operating Profit

Million Yen

FY9/20FY9/19% Million Yen

17,938
16,796

Non-GAAP
Operating Profit

6.8
10.0

2,274
183

% Million Yen

―
-81.3

2,452
2,065

Profit before tax% Million Yen

18.8
104.2

2,325
-81

Profit for theperiod attributableto owners of theparentProfitfor the period% Million Yen% Million Yen

%

―
―

―
―

―
―

1,471
-542

1,464
-547

(Note) Non-GAAP operating profit refers to the profit indicator used to assess ordinary business conditions after adjustments are made to IFRS-based
operating profit pertaining to temporary factors such as the impairment losses and gains or losses on the sales of fixed assets.

Basic earnings per
share
FY9/20FY9/19Diluted earnings per
share

ROE

Revenue Operating
Margin

ROA

Yen

Yen

%

%

%

11.58
-4.33

11.53
-4.33

9.6
-3.6

7.2
-0.3

12.7
1.1

Equity attributable toowners of the parent

Ratio of equity
attributable to ownersof the parent to total
assetsEquity attributable toowners of parent per
share(2) Consolidated Financial Position
Total Assets

FY9/20FY9/19Total Equity

Million Yen

Million Yen

Million Yen%

Yen

34,42530,413

15,81114,80915,793
14,79645.9
48.7

124.90117.02(3) Consolidated Cash Flow Information
Cash flows from (used in)operating activities

Cash flows from (used in)investing activities

Cash flows from (used in)financing activities

Cash and cash equivalents
at end of year

Million Yen

Million Yen

Million Yen

Million Yen

2,340
1,258

-804
-205

-1,941-1,411

14,081
14,488FY9/20FY9/192. Dividend Conditions
Dividends
End of 1Q

FY9/19FY9/20FY9/21
Estimate

End of 2Q End of 3Q

Term-end

Total Value of
Dividends(Total)

Total

Dividend Payout
Ratio(Consolidated)

Dividend on equity
attributable toowners of theparent(Consolidated)

Yen

Yen

Yen

Yen

Yen

Million Yen

%

%

―
―

―
―

―
―

2.00
2.00

2.00
2.00

256
256

―
17.3

1.7
1.7

―

―

―

―

―

(Note) Estimates for dividends in the fiscal year ending September 30, 2021 have yet to be decided.

―

3. Consolidated Financial Results Forecast for the Fiscal Year Ending September 30, 2021 (From October 1, 2020 to
September 30, 2021)(% figures represent year-over-year change)
Profit for the period
Non-GAAP Operating profit attributable to owners of the
Basic earnings per shareparentRevenue
Full Year

Million Yen%

Million Yen%

Million Yen%

Yen

20,000

11.5

2,850

16.2

1,785

21.9

14.12

*Annotation(1) Important changes in subsidiaries, including changes in the scope of consolidation: None
(2) Changes in accounting methods, procedures, presentation methods
Changes in accounting policies required by IFRSs:
Applicable
Other changes in accounting methods:
None
Changes in accounting estimates:
None(3) Shares issued (common stock)
Shares issued as of term-end (incl. Treasury stock):
Treasury stock as of term-end:
Average number of shares outstanding:

FY9/20FY9/20FY9/20138,916,500 FY9/19
12,463,440 FY9/19
126,450,738 FY9/19

138,906,500
12,463,440
126,430,081(Note) The Company implements the stock incentive plan for the Directors and the Executive Officers of the Group. The number of treasury
stock as of term-end includes 1,739,200 shares of its stock held by the BIP Trust, as well as 10,724,240 shares of treasury stock heldby the Company. The Company’s stock held by the BIP Trust is also included in the number of treasury stock to calculate the average
number of shares outstanding.

(Reference) Non-Consolidated Earnings Overview
1. Non-Consolidated Financial Results for the Fiscal Year Ended September 2020 (From October 1, 2019 to September 30,
2020)(1) Non-Consolidated Earnings(% figures represent year-over-year change)
Net Sales
FY9/20FY9/19Operating Income

Ordinary Income

Net Income

Million Yen%

Million Yen%

Million Yen

%

2,766
3,026

-8.6
-31.9

919
1,187

-22.6
-51.9

904
1,314

-31.2
-49.3

EPS

Million Yen

-60
673

%

―
-67.5

Fully Diluted EPS

FY9/20FY9/19

Yen

Yen

-0.48
5.32

―
5.30

(2) Non-Consolidated Financial Position
Total Assets
FY9/20FY9/19Net Assets

Net Asset Ratio

Book Value per Share

Million Yen

Million Yen%

Yen

14,996
15,618

11,068
11,374

73.8
72.8

87.53
89.96

(Reference) Capital: ¥11,068 million in FY9/20, ¥11,374 million in FY9/19*The summary of consolidated financial results for the fiscal year is not subject to the auditing by the Certified Public
Accountants or the audit corporation.
*Disclaimer regarding appropriate use of forecasts and related points of note
(1) Regarding Consolidated Financial Results Forecast
Any description regarding the future in this material, such as financial results forecast and future outlook, isbased on the available information and certain conditions which the Company believes to be reasonable at this time, andactual financial results may be substantially different from the forecast due to various factors.
For the conditions which the forecast is based on, please refer to “1. Overview of Earnings Performance, etc.
(1) Earnings Performance Analysis.”(2) Appendix
The Company held a financial results briefing as below. The materials are available on the website. The audio
archive of briefing is also available on the website.
October 29, 2020 (Thu.) - FY9/20 Financial Results Briefing for Institutional Investors, Analysts and the Press

Index
1. Overview of Earnings Performance, etc. ……………………………………………………………………..
(1) Earnings Performance Analysis………………………………………………………………………………
(2) Financial Conditions Analysis ………………………………………………………………………………
(3) Cash Flow Status in the Fiscal Year under Review …………………………………………………………
(4) Future Outlook ………………………………………………………………………………………………
(5) Basic Policy Regarding the Distribution of Profits, and Dividends in the Current and Next Terms ……….
2. Basic Stance on the Choice of Accounting Standards ………………………………………………………….
3. Consolidated Financial Statements ……………………………………………………………………………..
(1) Consolidated Statement of Financial Position ………………………………………………………………
(2) Consolidated Statement of Profit or Loss……………………………………………………………………
(3) Consolidated Statement of Comprehensive Income…………………………………………………………
(4) Consolidated Statement of Changes in Equity ………………………………………………………………
(5) Consolidated Cash Flow Statement…………………………………………………………………………..
(6) Notes on Consolidated Financial Statement ....………………………………………………………………
(Notes on the Premise of a Going Concern) ………………………………………………………………..
(Changes in the Company Policy) ………………………………………………………………………….
(Information on Reportable Segments) …………………………………………………………………….
(Information on Value per Share) ………………………………………………………………………….

1

2
2
3
3
4
4
4
5
5
7
8
9
10
11
11
11
11
14

1. Overview of Earnings Performance, etc.
(1) Earnings Performance Analysis(Earnings for the current term)
In the operation environment in 2020, the economic activity has been stagnant due to the global
pandemic of COVID-19, and the demand for advertisement decreased under the state of emergency announcedin April, as it restrained people from going out and depressed consumer activities. In mid-May, as the state of
emergency was lifted and the economic activity slowly recovered, the advertising demand which was declining
since late March hit the bottom in May and has continued to recover until September.
In 2019, the individual smartphone ownership rate in Japan grew up to 67.6% and exceeded more than
80% among young people in their 10’s to 30’s, showing that the quantitative expansion is progressing
particularly among millennials and generation Z. In addition, the purpose of using smartphones diversifies as
the rate of use of social media rises, and a change can be also seen on the side of quality (Source: “The resultof survey of communication use trend in 2019” of the Ministry of Internal Affairs and Communications.) In thetime that smartphones are becoming the main device when people use the Internet, in the service andapplication market, the content business such as videos, music and e-books is expanding. The way to utilize
social media is not only to communicate with others but also to purchase stuff, and because the influence is theway stronger than before, the demand for supporting marketing rises to utilize each medium character, data andAI.
In such environment, in the main Digital Marketing Business, revenue and operating profit increased
driven by expanding projects as consumption is shifting to online since COVID-19 and by promoting thealliance with Dentsu group. In the Media Platform Business, the increase in revenue was not enough to cover
the expenses as the businesses expand, and the deficit increased.
For the expansion into new business segment, the Group made an equity participation in each company
in a sport domain, a sharing-asset domain and an entertainment domain and started the business alliance.
As a result, revenue increased to ¥17,938 million (up 6.8% year on year), Non-GAAP operating profit
increased to ¥2,452 million (up 18.8% year on year), operating profit increased to ¥2,274 million (¥183 million
last year), profit before tax increased to ¥2,325 million (-¥81 million last year), profit for the period increasedto ¥1,471 million (-¥542 million last year), and profit attributable to owners of parent totaled ¥1,464 million (¥547 million last year).
For non-consolidated earnings, due to decrease in dividend income etc., net sales decreased to ¥2,766
million (decreased 8.6% year on year), operating income decreased to ¥919 million (decreased 22.6% year onyear), ordinary income decreased to ¥904 million (decreased 31.2% year on year) and net loss for the period is¥60 million (¥673 million of net income for the period last year).
The Group discloses consolidated business results in terms of both its internal measures which the
management relies upon in making decisions (hereinafter the “Non-GAAP financial measures”) and thoseunder IFRS. Non-GAAP operating profit is operating profit under IFRS after deducting unusual items tomeasure constant business results. The management believes that the disclosure of Non-GAAP financial
measures facilitates comparison between the Group and peer companies in the same industry or comparison ofits business results with those of prior fiscal years by stakeholders, and can provide useful information inunderstanding the underlying business results of the Group and its future outlook. Unusual items refer to oneoff items, such as impairment loss and gain or loss on sales of non-current assets, that the Group believes shallbe excluded for the purposes of preparing a future outlook based on certain rules. In addition, because it will be
useful for users of financial statement, the Group voluntarily disclose “Net Sales”, which is shown as the total
amount for all transactions, although the disclosure is not in accordance with IFRS.
Reconciliation from operating profit to Non-GAAP operating profit and Net Sales are as below:(units: ¥mn)
Fiscal year ended
Fiscal year ended
Change ofRate ofSeptember 30, 2019
September 30, 2020
amountchangeOperating profit

－

183

2,274

2,091

1,804

53

-1,751

Adjustment (Others)

78

125

47

Non-GAAP operating profit

2,065

2,452

387

18.8％

Net Sales

76,501

76,489-12-0.0％

Adjustment (Impairment
loss)

2

Operating results by reportable segment are as follows. From the current term, the segment names arechanged from Internet Marketing Business to Digital Marketing Business and from Media Content Business toMedia Platform Business. This is the only changes to names and there is no impact on the segment
information. The information regarding the previous year is also explained in the names after the change.
(i) Digital Marketing Business
The Digital Marketing Business consists of business segments that provide comprehensive digitaltransformation support to clients, mainly in the digital marketing domain.
In this year, the number of clients in collaboration with Dentsu group steadily increased, and projects ofclients in the area such as game, manga, video streaming and e-commerce expanded as meeting the demand of
online consumption.
As a result, revenue is ¥15, 807 million (up 4.8% year on year) and Non-GAAP operating profit is ¥5,248
million (up 9.9% year on year).
(ii) Media Platform Business
The Media Platform Business consists of Manga Content Business “GANMA!”, Recruitment Platform
Business “ViViViT”, Social Contribution Business “gooddo”, Medical Platform Business “Pharmarket”,
Childcare Platform Business “Babyful” etc.
In this year, the advertising revenue of “GANMA!” decreased largely affected by the expansion of
COVID-19. On the other hand, the accumulated application downloads totaled 14.6 million at the end of
September in 2020, and the revenue from subscription steadily increased. The other businesses than GANMA!
developed and increased the revenue, but COVID-19 restrained the progress, and deficit increased as the otherexpenses increased.
As a result, revenue is ¥2,487 million (up 24.0% year on year) and Non-GAAP operating loss is ¥956
million (¥901 million last year).
(2) Financial Conditions Analysis
Total assets at the end of the fiscal year under review increased by ¥4,012 million compared to the end of
the previous fiscal year and reached ¥34,425 million. This is mainly due to the operating receivables increasedby ¥2,715 million.
Total liabilities at the end of the fiscal year increased by ¥3,010 million compared to the end of theprevious fiscal year and reached ¥18,613 million. This is mainly due to the operating debt increased by ¥2,254
million.
Total net assets at the end of the fiscal year increased by ¥1,002 million compared to the end of theprevious fiscal year and reached ¥15,811 million. This is mainly due to the payment of dividend is ¥253
million and the profit for the period totaled ¥1,471 million.
(3) Cash Flow Status in the Fiscal Year under Review
As of September 30, 2020, cash and cash equivalents decreased by ¥408 million and amounted ¥14,081
million. The following is a description of the situation and factors of each category of cash flow in the fiscal
year under review.
(i) Cash flow from (used in) operating activities
Cash flow from operating activities stood at ¥2,340 million (cash-in of ¥1,258 million in the previous
fiscal year), primarily because the profit before tax totaled ¥2,325 million.
(ii) Cash flow from (used in) investing activities
Cash flows used in investing activities stood at ¥804 million (cash-out of ¥205 million in the previous
fiscal year), primarily because the purchase of securities costed ¥962 million.
(iii) Cash flow from (used in) financing activities
Cash flow used in financing activities stood at ¥1,941 million (cash-out of ¥1,411 million in the previous
fiscal year). This is largely a reflection of outflows due to ¥850 million of the proceeds from long-termborrowings, ¥837 million of the repayment of lease obligations and ¥253 million of dividends payment.

3(4) Future Outlook(i) Policy
The Group has updated its mid-term policy which was planned in the fiscal year 2020 to deal with thechange of environment since COVID-19. It is expected that people’s sense of value and consumption activity
will drastically change, and consumption is shifting to be online. Under such environmental changes, as“domain expansion” is set to be the mid-term theme, the construction of system to adjust to the acceleration ofdigital transformation (DX) is regarded as the issue to solve, and the Group aims for the continuous growth in
the mid-long term and raising its corporate value.
*The mid-term policy is reviewed every year in the rolling method.
In the Digital Marketing Business, the development of e-commerce advertising domain will be enhanced.
Moreover, in order to the expansion of system in the Group’s data & solutions domain, the Intermediate
Holding Company will be established and the collection of management resource and promoting business of
DX support by strengthening cooperation will be accelerated.
In the Media Platform Business, by collecting the management resource to the high-growth domain, it
will be focusing on charges from users and enhance the business development of D2C domain.
In the expansion into new business segments, it will absorb the demand for DX focusing on selectedindustries.
(ii) Earnings Estimates for the next year
For the fiscal year ending September 30, 2021, both revenue and operating profit are expected to increase
year on year as each business segment develop.
Earnings estimates for the fiscal year ending September 30, 2021 (from October 1, 2020 to September 30, 2021)
Revenue
20,000 million yen
Non-GAAP operating profit
2,850 million yen
Profit attributable to owners of parent
1,785 million yen
The estimates above are based on the information available at the time of publication of this summaryand involve uncertain factors. Actual results may differ from them for various reasons.

(5) Basic Policy Regarding the Distribution of Profits, and Dividends in the Current and Next Terms
The Company recognizes that returning profits to our shareholders is a key management issue and will
flexibly implement the policy outlined below regarding the appropriate distribution of profits.
With regard to the distribution of retained earnings, we will consider our consolidated earnings
performance in each fiscal year, the need to fortify our financial position, and the Group business strategies,
etc., and distribute profits to maintain a dividend payout ratio of around 15% based on profit attributable toowners of parent. Furthermore, we have established a minimum full-year dividend target level of ¥2.0 per
share and seek to strike a balance between stable dividends and an appropriate level of profit distribution toallow us to grow our earnings. In addition, we will endeavor to utilize our retained earnings for investments intraining personnel, optimizing and reinvigorating our existing businesses, and capturing new business areasthat have the potential for high growth and profitability.
Based on these policies, we expect to pay a ¥2.0 dividend per share during the current fiscal year as ayear-end dividend.
Furthermore, with regard to dividends in the next term, we expect to pay dividends in accordance withthe policy mentioned above and will announce the specific value for our dividend estimate as soon as weannounce earnings estimates for the full year.

2. Basic Stance on the Choice of Accounting Standards
The Group promotes the development of global operations and adopted IFRS from the fiscal year ended
September 30, 2016 to improve the quality of business administration through the unification of accounting
procedures within the Group and to improve the convenience of stakeholders, including shareholders andinvestors in Japan and overseas, by increasing the international comparability of financial information incapital markets.

43. Consolidated Financial Statements and Key Notes(1) Consolidated Statement of Financial Position(Thousand yen)Previous Term(Ended September 30,2019)

Current Term(Ended September 30, 2020)

14,488,431
10,032,303
19,870102,853489,319
25,132,776

14,080,864
12,747,068
45,372
14,520485,044
27,372,868

382,685―
112,545

319,851
1,007,726
83,577887,521963,570

2,990,742
12,725893,5825,279,800
30,412,576

3,546,126
9,528
1,121,465
7,051,843
34,424,711

AssetsCurrent assets
Cash and cash equivalents
Operating receivables
Inventories
Other financial assets
Other current assets
Total current assets
Non-current assets
Property, plant and equipment
Right-of-use assets
Intangible assets
Investments accounted for using equity
methodOther financial assets
Other non-current assets
Deferred tax assets
Total non-current assets
Total assets5

(Thousand yen)Previous Term(Ended September 30,2019)

Current Term(Ended September 30, 2020)

8,799,475
1,536,893
229,836
1,162,809
11,729,013

11,053,053
2,375,975
477,315
1,407,583
15,313,926

3,765,250
109,359
3,874,609
15,603,622

3,121,500
177,928
3,299,428
18,613,354

2,125,314
3,664,788-1,691,842
10,750,768-52,914

2,125,384
3,664,788-1,691,842
11,971,086-276,037

14,796,114

15,793,379

12,84014,808,954
30,412,576

17,97815,811,357
34,424,711

Liabilities and Equity
Liabilities
Current liabilities
Operating payables
Other financial liabilities
Current income taxes payable
Other current liabilities
Total current liabilities
Non-current liabilities
Other financial liabilities
Provisions
Total non-current liabilities
Total liabilities
EquityEquity attributable to owners of parent
Share capital
Share premium
Treasury shares
Retained earnings
Other components of equity
Total equity attributable to owners ofparentNon-controlling interests
Total equity
Total liabilities and equity6(2) Consolidated Statement of Profit or Loss
Previous Term(Ended September 30,2019)(Thousand yen)
Current Term(Ended September 30, 2020)

16,795,505
2,832,790
13,962,715

17,937,745
3,341,576
14,596,169

11,923,796

12,155,667

41,337
1,897,123
183,133
154,334
80,494

13,063
179,169
2,274,396
17,85180,385-338,283

113,258-81,310460,213-541,523

2,325,120
854,462
1,470,658-546,929
5,406-541,523

1,464,342
6,316
1,470,658

-4.33
-4.33

11.58
11.53

Revenue
Cost of sales
Gross profit
Selling, general and administrative
expenseOther income
Other expense
Operating profit
Finance income
Finance costs
Share of profit from investments
accounted for using equity method
Profit before tax
Income tax expense
ProfitProfit attributable to:
Owners of parent
Non-controlling interests
Total
Earnings per share
Basic earnings per share (Yen)
Diluted earnings per share (Yen)7

(3) Consolidated Statement of Comprehensive Income
Previous Term(Ended September 30,2019)(Thousand yen)
Current Term(Ended September 30, 2020)-541,523

1,470,658

59,516-209,500-131,634-2,743-2,90011,016-1,717―-76,735-201,227

Total comprehensive income-618,258

1,269,431

Comprehensive income attributable to:
Owners of parent
Non-controlling interests
Comprehensive income-623,664
5,406-618,258

1,263,115
6,316
1,269,431

ProfitOther comprehensive income
Items that will not be reclassified to profit
or loss
Net changes in financial assets measured
at fair value through othercomprehensive income
Items that may be reclassified to profit orloss
Exchange differences on translating
foreign operations
Cash flow hedges
Share of other comprehensive income ofassociates accounted for using equity
methodTotal other comprehensive income, net oftax

8(4) Consolidated Statement of Changes in Equity(Thousand yen)
Equity attributable to owners of parent

Balance at October 1, 2018

SharecapitalSharepremium

TreasurysharesRetainedearnings

Other
componentsof equity

Total

Noncontrollinginterests

Total equity

2,120,484

3,663,023-1,691,819

11,493,305

87,244

15,672,237

57,797

15,730,034

Profit－－－-546,929－-546,929

5,406-541,523

Other comprehensive income

－

－

－

－

-76,735-76,735－-76,735

Total comprehensive income
Issue of new shares
Dividends of surplus
Purchase and disposal oftreasury shares
Changes in ownership interestsin subsidiaries that result in lossof control
Other

－

－

－

-76,735-623,664

1,765
－

－
－

-252,786-6,245－350-252,786

5,406
－
－

-618,258

4,830－-546,929
－

－

－

-23

－

－

-23

－

-23

－

－

－

－

－

－

-50,363-50,363－－－

57,178-57,178

－

－

－

4,830

1,765

-23

-195,608-63,423-252,459-50,363-302,822

2,125,314

3,664,788-1,691,842

10,750,768-52,914

14,796,114

12,84014,808,954

Total amount of transactions
with owners
Balance at September 30, 2019

350
-252,786(Thousand yen)
Equity attributable to owners of parent

Balance at October 1, 2019

SharecapitalSharepremium

TreasurysharesRetainedearnings

Other
componentsof equity

Total

Noncontrollinginterests

Total equity

2,125,314

3,664,788-1,691,842

10,750,768-52,914

14,796,114

12,84014,808,954

Cumulative effects of changes
in accounting policies

－

－

－

-13,035－-13,035－-13,035

Restated balance as of October 1,
20192,125,314

3,664,788-1,691,842

10,737,733-52,914

14,783,079

12,84014,795,919

Profit－－－1,464,342－

1,464,342

6,316

1,470,658

Other comprehensive income

－

－

－

－

-201,227-201,227－-201,227

Total comprehensive income
Issue of new shares
Dividends of surplus
Purchase and disposal oftreasury shares
Changes in ownership interestsin subsidiaries that result in lossof control
Other

－

－

－
－
－

-252,88670-252,886

6,316
－
－

1,269,431－－-201,227－－

1,263,115

70－

1,464,342
－

－

－

－

－

－

－

－

－

－

－

－

－

－

－

－

－

70
-252,886－－－

21,897-21,8961-1,178-1,177

Total amount of transactions
with owners

70

－

－

-230,989-21,896-252,815-1,178-253,993

Balance at September 30, 2020

2,125,384

3,664,788-1,691,842

11,971,086-276,037

15,793,379

17,97815,811,357

9

(5) Consolidated Cash Flow Statement

Previous Term(Ended September 30,2019)(Thousand yen)
Current Term(Ended September 30, 2020)-81,3102,325,120

209,766
1,803,979-4,14536,085983,299
53,078-3,55736,040338,283-113,258-153,846

63,648112,412-9,798-301,505-227,780
1,722,141
54,717-36,377
458,081-940,611
1,257,951-2,714,765-25,5022,253,578
133,152
2,990,833
40,766-36,335
116,529-771,315
2,340,478

654,145-729,568-64,850-21,817-42,919-205,009

51,649-961,975-60,470-13,078
179,607-804,267-308,435―-850,008－-252,786-23
350-1,410,902-850,008-837,035-252,886―-1,108-1,941,037-75,881-2,741-433,841-407,567

14,922,272

14,488,431

14,488,431

14,080,864

Cash flows from (used in) operating activities
Profit before tax
Adjustments:
Depreciation and amortization expense
Impairment loss
Interest income and dividend income
Interest expenses
Share of (profit) loss of entities accounted
for using equity method
Other
Increase or decrease in working capital
Decrease (increase) in operating receivables
Decrease (increase) in inventories
Increase (decrease) in operating payables
Other
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes refund
Income taxes paid
Cash flows from (used in) operating activities
Cash flows from (used in) investing activities
Proceeds from sales of securities
Purchase of securities
Purchase of property, plant and equipment
Purchase of intangible assets
Other
Cash flows from (used in) investing activities
Cash flows from (used in) financing activities
Net increase (decrease) in short-termborrowings
Proceeds from long-term borrowings
Repayments of lease obligations
Cash dividends paid
Purchase of treasury shares
Other
Cash flows from (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of
periodCash and cash equivalents at end of period10(6) Notes on Consolidated Financial Statement(Notes on the premise of a going concern)
No applicable items.
(Changes in the Company Policy)
The Group has adopted IFRS 16 “Leases” from the consolidated year ended September 30, 2020. As
following the transitional measures of IFRS 16, the Group has adopted the standard retroactively and recognizes
the cumulative effect of the initial adoption of the new standard as of October 1, 2019. Therefore, Our Group
has not restated the comparative information.
IFRS 16 establishes the principles for lessees and lessors to recognize, measure, present and disclose
lease contracts. Under IFRS 16, lessees use a single accounting model without separating finance leases fromoperating leases as required under the previous standard, IAS 17 "Leases" (hereinafter referred to as IAS 17). At
the initiation date of the lease, a lessee will recognize an obligation to pay the lease payments (lease liability)
and right-of-use assets representing the right to use the underlying asset during the corresponding lease term.
Subsequently, the lessee recognizes interest expense arising from lease liabilities and depreciation expense
arising from right-of-use assets separately. The right-of-use assets are depreciated on a straight-line basis overthe lease term.
The Group recognizes lease liabilities under IFRS 16 on operating leases that were previously classified
in accordance with IAS 17. The remaining lease payments are measured at present value using the lessee's
incremental rate of return as of October 1, 2019.
The Group has adopted the following expedient in applying IFRS 16 to leases that were previouslyclassified as operating leases under IAS 17.
-

Applying a single discount rate to portfolios of leases with similar characteristics.
Applying a waiver that does not recognize right-of-use assets and lease liabilities to leases having aremaining lease term of 12 months or less.
Excluding initial direct costs from the measurement of right-of-use assets as of the effective date.
Determining after the fact when calculating the lease term of a contract that includes an option to extend or
terminate.

Upon the adoption of IFRS 16, the Group additionally recognized right-of-use assets of ¥1,725,653,000
and lease liabilities of ¥1,708,507,000, and also a decrease of ¥13,035,000 in retained earnings at the beginningof the period (after tax effect accounting) as of October 1, 2019. Right-of-use assets are presented as "Right-ofuse assets" and lease liabilities are included in "Other financial liabilities (liabilities)" and "Other financial
liabilities (non-current liabilities)".
(Information on Reportable Segments)
1. Overview of reportable segments
The Group has a holding company structure where the Company is a holding company and its
subsidiaries (or their groups) are business units. Activities directly related to revenue generation are conducted
solely by business units, which consist of the Company’s subsidiaries (or their groups).
The Group’s reportable segments are based on business segments for which separate financial
information is available and that the highest decision-maker examines on a regular basis to determine the
distribution of management resources and evaluate the results. In consideration of similarities among the
economic characteristics of each business segment and their quantitative importance and for the purpose of
enabling the users of the financial statements to appropriately evaluate the Group’s businesses and the economic
circumstances for the businesses and their effects on the businesses, the Group discloses information on tworeportable segments: the Digital Marketing Business and the Media Platform Business,
i. Digital Marketing Business
The Digital Marketing Business consists of business segments that provide comprehensive digitaltransformation support to clients, mainly in the digital marketing domain such as the sales and operation ofadvertisement, as well as providing solutions utilizing data and AI and marketing support in integration of
online and offline through the alliance with Dentsu group.
ii. Media Platform Business
The Media Platform Business consists of Manga Content Business “GANMA!”, Recruitment Platform
Business “ViViViT”, Social Contribution Business “gooddo”, Medical Platform Business “Pharmarket”,
Childcare Platform Business “Babyful” etc. This segment includes business units that have commenced
11operation in recent years and have not made a profit due to prior investment for revenue generation. The highest
decision-maker makes decisions on the distribution of management resources to those business units andevaluates their results, assuming risks and economic value that allow the Group to recover the investment costs
through future revenue generation.
2. The change of reportable segments names
From the current term, the segment names are changed from Internet Marketing Business to DigitalMarketing Business and from Media Content Business to Media Platform Business. This is the only changes tonames and there is no impact on the segment information. The information regarding the previous term is also
explained in the names after the change.
3. Measurement of reportable segments’ profits and losses
Segment profit is non-GAAP operating income, which is the sum of operating income in compliance withIFRS and temporary factors, including impairment losses and gains (losses) on sales of property, plant andequipment.
The Group voluntarily discloses the total amount of all transactions as net sales. The disclosure of net sales is
not disclosure in accordance with IFRS. The management believes, however, that net sales are useful
information for users of the financial statements, and voluntarily discloses net sales in its consolidated net
profit-and-loss statement and segment information as reference information.
The prices of inter-segment transactions are determined based on the prices of transactions with externalcustomers.

12

4. Information on reportable segments’ profits and losses

Previous consolidated fiscal year (from October 1, 2018 to September 30, 2019)(Thousand yen)
DigitalMedia Platform
Total
Adjustment*
Consolidated
MarketingSegment revenue
15,079,279
2,005,057
17,084,336-288,831
16,795,505
Segment profit (loss)*
4,774,723-900,883
3,873,840-1,808,941
2,064,899
Segment sales
75,310,789
2,005,057
77,315,846-815,047
76,500,799(Notes) 1. The segment profit is non-GAAP operating profit.
2. Adjustment includes the elimination of profit and loss transactions between reportable segments andexpenses for the operation of the holding company not attributable to reportable segments.
Fiscal Year Ended September 30, 2020 (from October 1, 2019 to September 30, 2020)(Thousand yen)
DigitalMarketingMedia Platform

Total

Adjustment

Consolidated

Segment revenue
15,806,795
2,486,885
18,293,680-355,935
17,937,745
Segment profit (loss) *5,248,301-995,759
4,292,542-1,840,129
2,452,413
Segment sales
74,727,812
2,486,885
77,214,697-725,952
76,488,745(Notes) 1. The segment profit is non-GAAP operating profit.
2. Adjustment includes the elimination of profit and loss transactions between reportable segments andexpenses for the operation of the holding company not attributable to reportable segments.
Reconciliation of segment profit (loss) and profit before tax

Segment profit (non-GAAP operating income)Impairment loss
Other profit (loss) (net)
Financial profit (loss) (net)Share of profit of entities accounted for using equity
methodProfit before tax- 13 -

Previous Term(Ended September
30,2019)2,064,899-1,803,979-77,787
73,840(Thousand yen)
Current Term(Ended September 30,
2020)
2,452,413-53,078-124,939-62,534-338,283

113,258-81,3102,325,120

(Information on Value per Share)
The basis of the calculation of earnings per share is shown in the table below.
Previous Term(Ended September
30,2019)
Profit attributable to owners of parent (thousand yen)
-546,929
Average number of ordinary shares outstanding
during the fiscal year (thousand shares)
Number of potential shares with dilutive effects
Number of warrants (thousand shares)
Average number of shares outstanding inconsideration of the number of potential shares withdilutive effects (thousand shares)
Basic earnings per share (yen)Diluted earnings per share (yen)Current Term(Ended September 30,
2020)
1,464,342

126,430

126,451―507

126,430

126,958

-4.33
-4.33

11.58
11.53

(Notes) In the previous term, 530,000 warrants of shares have been excluded from the number of shares used in thecalculation of diluted earnings per share because their inclusion would be anti-dilutive.

- 14 -