(This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between this document and the Japanese original, the latter shall prevail.)
Summary of Consolidated Financial Results for the Six Months ended September 30, 2020 (Japanese GAAP)
November 10, 2020
Company name: Digital Media Professionals Inc.
Listing: Tokyo Stock Exchange
Code number: 3652
URL: https://www.dmprof.com/en
Representative: Tsuyoshi Osawa, President and COO
Contact person: Tomoyuki Ietaka, Executive Officer, CFO, General Manager of Accounting/Corporate Planning Dept.Tel. (03) 6454 - 0450
Scheduled date of filing Quarterly Securities Report: November 12, 2020
Scheduled date of payment of cash dividends: Supplementary materials for the quarterly financial results: Yes
Briefing session on the quarterly financial results: Yes
1. Consolidated financial results for the six months ended September 30, 2020 (April 1, 2020 through September 30, 2020)(1) Consolidated operating results(Percentages indicate year-on-year changes)
Net income attributable toowners of parent
Millions of yen% Millions of yen% Millions of yen% Millions of yen%
6 months ended Sep 30, 2020
533
△191
△155
△156
－
－
－
－
6 months ended Sep 30, 2019
－
－
－
－
－
－
－
－
Reference) Comprehensive income: △156 million yen as of Sep 30, 2020; - million yen as of Sep 30, 2019
Net sales

Operating income

Net income per shareyen△49.84－6 months ended Sep 30, 2020
6 months ended Sep 30, 2019

Ordinary income

Net income per sharedilutedyen－－

Since the quarterly consolidated financial statements have been prepared from the first quarter of the fiscal year ending March 2021,
the figures for the first quarter of the fiscal year ended March 2020 and the rate of change year on year are not stated.

(2) Consolidated financial position
Total assets

Net assets

Millions of yen

Equity ratio

Millions of yen

As of September 30, 2020
3,730
3,455
As of March 31, 2020－－
Reference) Shareholders' equity: 3,455 million yen as of Sep 30, 2020; - million yen as of March 31, 2020

%
92.6
－

Since the quarterly consolidated financial statements have been prepared since the first quarter of the fiscal year ending March 2021,
the figures as of March 31, 2020 are not stated.

2. Cash dividends
Annual dividends per share
2Q-end3Q-endYear-end
yen
yen
yen
Year ended March 2020
0.00
0.00
Year ending March 2021
0.00
Year ending March 2021 (Forecast)
0.00Note) Revision of dividends forecast during the period: None
1Q-end
yen
-

Total
yen
0.00
0.00

3. Forecasts of consolidated operating results for the year ending March 31, 2021 (April 1, 2020 through March 31, 2021)
Net Sales

Operating income% Millions of yen
Full year
1,500
△150
Note) Revision of forecasts during the period: Yes
Millions of yen(Percentages indicate year-on-year changes.)
Net income attributable to Net income
Ordinary income
owners of parent
per share% Millions of yen% Millions of yen
%
Yen
△100
△100
△31.82

Notes:1. Changes in significant subsidiaries during the current consolidated cumulative period (changes in specified subsidiaries
accompanying changes in the scope of consolidation): None
2. Application of accounting treatments specific to the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies(1) Changes in accounting policies resulting from revisions of accounting standards: None
(2) Changes in accounting policies except (1): None
(3) Changes in accounting estimation: None
(4) Restatement: None
4. Number of shares issued(1) Number of shares issued at the end of the period (including treasury shares)
As of Sep 30, 2020

3,152,400 shares

As of March 31, 2020

3,131,700 shares

As of March 31, 2020

1,069 shares(2) Number of treasury shares at the end of the period
As of Sep 30, 2020

2,289 shares(3) Average number of shares issued during the period
6 months ended Sep 30, 2020

3,135,280 shares

6 months ended Sep 30, 2019

3,032,891 shares

Note: Explanation regarding the appropriate use of business forecasts and other special notes
The forward-looking statements such as business forecast in this document are based on information currently available to
the Company and on certain assumptions deemed to be reasonable. The Company does not guarantee the achievementof the forecasts. Actual results may differ significantly for a number of reasons.
For the conditions and notes on the use of business forecast, please refer to"1. Qualitative information on quarterly financial results (3) Consolidated financial forecasts and other forward-looking statements."

1. Quarterly financial results(1) Operating results
Since the Company has prepared quarterly consolidated financial statements from the first quarter of the current
consolidated fiscal year, it does not provide a year-on-year comparison of operating results and financial position.

During the six months of the current fiscal year, the Japanese economy was in a difficult situation in terms of corporate
earnings and capital investment due to the impact of the new coronavirus infection, although there were signs of apartial recovery in personal consumption and production. The global economy was also in a severe situation due to theimpact of the global outbreak of the new coronavirus infection, although there were some signs of recovery. At present,
some countries in Europe and the U.S. have started to lock down again, and the situation does not allow for optimism.
As for the future, it is necessary to take extremely difficult steps to gradually raise the level of economic activity while
taking measures to prevent the spread of infection.
Even in the semiconductor industry to which our group belongs, the impact of the economic downturn is unavoidable
at present, but in the medium term, demand is expected to grow for IoT that connects everything to the Internet, artificial
intelligence (AI), big data, next-generation high-speed communication standards, and autonomous driving.
In the AI/visual computing field, which is our group's business domain, the acceleration of innovation and the increasingrole of AI in solving social issues, including current difficulties, and in realizing a safe and secure society are expected.
In such an environment, our group will strive to become the world's leading "AI Computing Company" by contributing
to solving social issues through providing AI solutions that leverage the strength of having a consistent development
system of AI algorithms, software and hardware.
As concrete measures and results during the second quarter, we firstly launched ZIA™ Cloud SAFE, a SaaS-type safe
driving assistance cloud service using Amazon Web Services (AWS) in the safe driving assistance field, a focused area
for our group. ZIA™ Cloud SAFE is based on the same technology platform as ZIA™ SAFE, which was announced in
November last year and has a proven track record as a safe driving assistance system development platform. ZIA™
Cloud SAFE has already been adopted by major customers, and we expect to generate stable and continuous revenue
from the third quarter of the current fiscal year by offering subscription licenses, which are a form of licensing that canmore flexibly meet customer needs. In addition, starting from the second quarter of the current fiscal year, we havebeen recording running royalties based on the safe driving assistance functions installed in customers' equipment andthe number of units shipped. As described above, in the AI-related business, we will aim to expand the recurringbusiness in addition to IP license income.
Additionally, we have continued to promote and seek collaborations and alliances in Japan and overseas to expand
our business.
Furthermore, as businesses regarding the New Energy and Industrial Technology Development Organization (NEDO)
following the previous fiscal year, we not only have continued to operate AI edge contests in the commissioned projectof "Survey of issues for finding ideas regarding Technology Development for AI Chip and Next generation Computingfor High-efficiency and High-speed Processing" but also have worked on subsidized projects of the development of "AI
Platform for Artificial Intelligence (AI): An Energy Efficient AI Engine" and "Research and development of AI hardware
for AI pathology imaging system for cancer companion diagnostics."
Regarding the business results for the six months of the current fiscal year, mass production shipments of the image
processing semiconductor "RS1" continued in the LSI product business. In the IP core license business, we acquired
new license business for robotics, despite a decline in running royalties for digital equipment. In the professional service
business, in addition to the commissioned revenue in NEDO's AI edge contest operation, we got orders for contracted-1-development services for robotic vehicles.
As a result, for the six months of the current fiscal year, we recorded net sales of 533 million yen, operating loss of 191
million yen, ordinary loss of 155 million yen mainly due to the recording of 37 million yen in subsidy income from NEDO
as non-operating income, and net loss attributable to owners of parent of 156 million yen.

Although our group has a single business segment, each business result is shown below in order to show businesstrends.
1) IP core license businessNet sales were 61 million yen attributable to new licenses of GPU and AI, running royalties and revenue frommaintenance support.
2) LSI product businessNet sales were 383 million yen attributable to the sales of the "RS1" mass production and AI FPGA module "ZIA™ C3."
3) Professional service businessNet sales were 87 million yen due to the booking of AI-related contracted development sales and NEDO contracted
development sales.

(2) Financial position
1) Overview of assets, liabilities and net assets
Current assets at the end of the second quarter of the current consolidated fiscal year were 2,951 million yen, mainly
consisting of cash and deposits of 2,051 million yen, securities of 443 million yen and accounts receivable of 295 million
yen. Fixed assets amounted to 778 million yen, mainly consisting of software of 131 million yen and investment
securities of 500 million yen.
Current liabilities and non-current liabilities at the end of the second quarter of the current consolidated fiscal year
totaled 274 million yen, mainly consisting of accounts payable of 208 million yen.
Total net assets at the end of the second quarter of the current consolidated fiscal year were 3,455 million yen, mainly
consisting of capital stock of 1,838 million yen, capital surplus of 1,858 million yen and retained earnings of -232 million
yen.
As a result, the equity ratio was 92.6%.
2) Overview of Cash FlowsThe balance of cash and cash equivalents at the end of the second quarter of the current consolidated fiscal year was
2,094 million yen.
Net cash provided by operating activities was 109 million yen mainly attributable to positive factors such as a decreasein notes and accounts receivable - trade of 317 million yen, an increase in accounts payable - trade of 69 million yen
and depreciation of 29 million yen, and negative factors such as loss before income taxes of 155 million yen, an increase
in inventories of 58 million yen and subsidy income of 37 million yen.
Net cash used in investing activities was 17 million yen mainly attributable to purchase of property, plant and equipment
and intangible assets of 17 million yen.
Net cash used by financing activities was 0 million yen attributable to payments for issuance of shares of 0 million yen.

(3) Consolidated financial forecasts and other forward-looking statements
It is necessary for the Japanese and global economies to take extremely difficult steps to gradually raise the level of
economic activity while taking measures to prevent the spread of infection, but the economies are expected to gradually-2-

move toward recovery while repeating ups and downs.
Although the semiconductor industry to which we belong will inevitably be affected by the economic downturn in the
short term, demand for semiconductors for AI/IoT is expected to expand in the medium term.
In the amusement market, one of our main markets, the occupancy rate of pachinko parlors is on a recovery trend, andthe removal of old regulation machines and their replacement with new regulation machines are expected to be carriedout in a systematic manner at the request of the National Police Agency and through the efforts of industry organizations.
On the other hand, the low pass rate for new machines and the weak motivation of parlors to purchase machines areaffecting the product and production plans of machine manufacturers, and our business results for the current fiscal
year are expected to be affected to some extent.
In addition, our focused fields of robotics and safe driving assistance are attracting a lot of attention from customers
and inquiries are on the rise. On the other hand, there is a trend of restraint in development investment by some AIrelated customers, which is expected to have some impact on our business results for the current fiscal year. However,as there are no major changes in the development roadmaps of our customers, we believe that this impact will belimited.
As described above, we expect that the new coronavirus infection will have a negative impact on consolidated businessresults in the short term. In the medium term (fiscal year ending March 31, 2022 and beyond) however, we will strive
to expand consolidated performance and corporate value by achieving stable earnings in the amusement market
through replacement demand for new regulation machines by December 2021 and subsequent market share expansion,as well as diversifying revenue sources and increasing earnings through the acceleration of new initiatives in the fieldsof robotics and safe driving assistance, our focused fields with growth markets.
Based on the above, for the fiscal year ending March 31, 2021, we forecast consolidated net sales of 1,500 million yen,operating loss of 150 million yen, ordinary loss of 100 million yen, and net loss attributable to owners of parent of 100
million yen.

-3-

2. Consolidated quarterly financial statements(1) Consolidated quarterly balance sheets(Yen thousand)Current Q2 period(As of Sep 30, 2020)
AssetsCurrent assets
Cash and deposits
Accounts receivable - trade
Securities
Finished goods
Work in process
Raw materials and supplies
Other
Total current assets
Non-current assets
Property, plant and equipment
Intangible assets
Software
Other
Total intangible assets
Investments and other assets
Investment securities
Other
Total investments and other assets
Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable - trade
Income taxes payable
Other
Total current liabilities
Non-current liabilities
Deferred tax liabilities
Asset retirement obligations
Total non-current liabilities
Total liabilities
Net assets
Shareholders' equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

2,050,732
295,840
443,787
4,021
5,423
66,46484,966
2,951,234
41,132
131,79725
131,822500,130
105,743605,873
778,828
3,730,063

208,083
11,04536,635
255,764
1,564
17,031
18,595274,360

1,838,882
1,858,093-232,103-1,525
3,463,347-7,541-102-7,644
3,455,703
3,730,063-4-

(2) Quarterly consolidated statements of income and comprehensive income
Consolidated quarterly statements of income(Yen thousand)Current Q2 period (YTD)(From Apr 1, 2020
To Sep 30, 2020)
Net sales

533,321

Cost of sales

371,532

Gross profit

161,788

Selling, general and administrative expenses

353,754

Operating loss

-191,966

Non-operating income
Interest income

1,222

Subsidy income

37,900Miscellaneous income

4

Total non-operating income

39,126

Non-operating expenses
Foreign exchange losses

1,804

Share issuance costs

584

Miscellaneous loss

0

Total non-operating expenses

2,390

Ordinary loss

-155,229

Loss before income taxes-155,229

Income taxes - current

1,145

Income taxes - deferred-111

Total income taxes

1,033

Loss

-156,263

Loss attributable to owners of parent-156,263

Consolidated quarterly statements of comprehensive income(Yen thousand)Current Q2 period (YTD)(From Apr 1, 2020
To Sep 30, 2020)
Loss-156,263

Other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment-102

Total other comprehensive income

-77

25

Comprehensive income-156,340

Comprehensive income attributable toComprehensive income attributable to owners ofparentComprehensive income attributable to noncontrolling interests-156,340--5-

(3) Quarterly consolidated statements of cash flows(Yen thousand)Current Q2 period (YTD)(From Apr 1, 2020
To Sep 30, 2020)
Cash flows from operating activities
Loss before income taxes-155,229

Depreciation

29,757

Share-based remuneration expenses

14,907

Interest income-1,218Foreign exchange losses (gains)

2,088

Subsidy income-37,900

Share issuance costs

584

Decrease (increase) in trade receivables

317,104

Decrease (increase) in inventories-58,619

Increase (decrease) in trade payables

69,546

Increase (decrease) in accounts payable - other-44,395

Other, net-39,654

Subtotal

96,971

Interest received

1,518

Income taxes paid

-19,512

Proceeds from subsidy income

30,242

Net cash provided by (used in) operating activities

109,218

Cash flows from investing activities
Purchase of securities-300,000

Proceeds from redemption of securities

300,000

Purchase of property, plant and equipment-11,650

Purchase of intangible assets-5,725

Net cash provided by (used in) investing activities-17,375

Cash flows from financing activities
Payments for issuance of shares-584

Purchase of treasury shares-43

Net cash provided by (used in) financing activities-628

Effect of exchange rate change on cash and cash equivalents-3,338Net increase (decrease) in cash and cash equivalents

87,875

Cash and cash equivalents at beginning of period

2,006,673

Cash and cash equivalents at end of period

2,094,549-6-